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Declassified per Executive Order 13526, Section 3.3 NND Project Number: NND 63316. By: NWD Date: 2011  GVN in this case, of course, would choose to risk the danger of inflation and could meet the financial burden of the Counter-Insurgency Plan in 1961. Secretary Thuan, however, expressed considerable concern regarding the prospects for 1962.

While recognizing that the final levels of both US and Vietnamese contributions to the FY 61 defense budget are still under negotiation, it must be kept in mind that in order to be certain that the 20,000 additional soldiers now authorized for the GVN Army are brought into the troop basis promptly, it may be necessary for the US to increase FY 61 contribution by the amount of the short-fall of $58 million to insure the success of the Counter-Insurgency Plan.

In order to implement items in the Counter-Insurgency Plan which are agreed to by the GVN and to carry out the additional measures recommended herein, the GVN defense budget for FY 62 might be in the order of $247. This budget would include, if mutually agreed upon, a US contribution of $161.0 million and a Vietnamese contribution of $86.0 million. This would provide the local currency needed to carry out this program of action for Vietnam. The Task Force points out that this level requires a four-fold increase Rh