EXCHANGE OF NOTES CONSTITUTING AN AGREEMENT BETWEEN THE UNITED STATES OF AMERICA AND INDIA RELATING TO THE
Washington, 19 September 1957
DEPARTMENT OF STATE WASHINGTON September 19, 1957
I have the honor to refer to conversations which have recently taken place between representatives of our two Governments, relating
to guaranties authorized by Section 413 (b) (4) (B) (i) of the Mutual Security Act of 1954, as amended, and to confirm the following
understandings reached as a result of the conversations :
1. The Governments of India and the United States of America will, upon request of either of them, consult respecting projects in
India proposed by nationals of the United States of America with regard to which guaranties under Section 413 (b) (4) (B) (i) of
the Mutual Security Act of 1954, as amended, have been made or are under consideration.
2. The Government of the United States of America agrees that it will issue no guaranty with regard to any project unless it is approved
by the Government of India.
3. With respect to such guaranties extending to projects which are approved by the Government of India in accordance with the provisions
of the aforesaid Section 413 (b) (4) (B) (i), the Government of India agrees ;
(a) That if the Government of the United States of America makes payment in United States dollars to any person under U.S.A. Private
Investment 19 Sep. 1957 636 any such guarantee, the Government of India will recognize the transfer to the United States of America
of any right, title or interest of such person in assets, currency, credits or other property on account of which such payment was
made and the subrogation of the United States of America to any claim or cause of action, or right of such person arising in connection
therewith. (b) That rupee amounts acquired by the Government of the United States of America pursuant to such guaranties shall be
accorded treatment not less favourable than that accorded to private funds arising from transactions of United States nationals which
are comparable to the transactions covered by such guaranties and that such rupee amounts will be freely available to the Government
of the United States of America for administrative expenditure. Upon receipt of a note from Your Excellency indicating that the foregoing
provisions are acceptable to the Government of India, the Government of the United States of America will consider that this note
and your reply thereto constitute an agreement between the two Governments on this subject, the agreement to enter into force on
the date of your note in reply. Accept, Excellency, the renewed assurances of my highest consideration.
For the Secretary of State:
His Excellency GAGANVIHARI LALLUBHAI MEHTA
Ambassador of India
EMBASSY OF INDIA WASHINGTON, D.C.
19 September, 1957
I have the honour to refer to Your Excellency's note of date in which it is stated that the two Governments have reached an undertaking
as a result of conversations relating to convertibility of Investment receipts authorised by Section 413(b) (4) (B) (i) of the Mutual
Security Act of 1954 as amended. It is my privilege to inform you that the Government of India has authorised me to accept the terms
contained therein as follows : (See note I) Please accept, Excellency, the assurances of my highest consideration.
Ambassador of India
JOHN FOSTER DULLES Secretary of State
Department of State Washington, D.C.