State Department Seeks to Check Israel by Deferring Action on Loans

Indications were mounting here today that the State Department is deferring action on pending Israeli applications for loans to initiate, the $200, 000,000 nuclear desalination project envisaged by President Johnson, and other assistance, to provide leverage to induce Israel to desist from development of nuclear weapons in the country.

Reference has been made to this at discussions among U.S. officials mindful of the forthcoming resumption of international talks at Geneva, aimed at preventing nuclear proliferation. Thought has been given to Israeli nuclear potentialities, conceptions of international inspection, and ideas of coaxing Israel to cooperate with promises of aid on nuclear desalination and other benefits.

The State Department has suggested notions of persuading Israel to cooperate by deferring action not only on nuclear desalination but also on pending development loan applications and by specifying less liberal terms and amounts of surplus commodity sales. The Department probably would not openly admit such pressure and might employ the pretext of cutting expenditures because of the Viet Nam war.

Suggestions for inspection by the International Atomic Energy Agency and other moves to inhibit and restrict nations with civilian nuclear capabilities from developing nuclear military potentialities have been advanced by William C. Foster, U.S. delegate to the Geneva disarmament conference, which resumes January 27, and by members of the Atomic Energy Commission and Joint Congressional Committee on Atomic Energy. A few days ago, a Senate resolution on non-proliferation was offered by Sen. John O. Pastore, Rhode Island Democrat, and obtained cosponsorship of 51 other Senators.