The Waterbury Democrat., 1941-08-05
JAPAN IS MOVING
 INTO INDO-CHINA
(continued from Page D

considering only joint defense" with Indo- China. Negotiations with Thailand, Ishti said, were confined to the economic field at the mo- ment.
 The ultra-nationaliStic newspaper Kokumin, asserting that Thailand should enter & defense" agreement with Japan, argued that "the fact that Thailand was forced to say re- gently it was not oppressed econ- omically or militarily by any coun- bespeakS Thailand's sorrowful plight, actually, Kokumin said, the Unite0 States, Great Britain and China were threatening Thail- and.
 Kokumin said the East Indies were an indispensable element" in a "Japanese-protected greater East Asia co-prosperity sphere" but Thailand was matter of immediate concern.
 In order to conserve the gasoline reserve, the railroad ministry de- cided today to suspend service effec- tive August 10 on 38 railroad lines which are driven by gasoline mo- tors.
 Expand Rationing
 The ministry of industry decided to expand its fuel rationing scheme, hitherto confined to gasoline and heavy oil, by including kerosene, light and machine oils.
 It was understood that the min- istry was considering higher rate of mixture of alcohol in gasoline in future. Oother measures be- lieves to be envisaged were con- solidation of oil refiners, establish ment of an oil control association and increase of artificial oil output in order to meet the situation caused by United States restrictions on oil exports.
 Chief spokesman Ishn said at a press conference that Japanese shipping to the United States would remain suspended pending settle ment of the cargo of the Japanese liner Tatuta Maru. Resumption of shipping depended, he said, on the question whether 1t would now be commercially profitable.
 CThe Tatuta Maru sailed from San Francisco yesterday, after un- loading $2,50O,O00 worth of raw silk and $500000 worth of miscel- laneous cargo. The latter had been nbled by American importers when the question arose whether it should discharge its cargo because of the freezing of Japanese aS- sets.)
 Spokesman Ishii said that he could not feel optimistic as to the future of Japanese-American trade but that he believed on the basis of reports from Admiral Kichi- saburo Nomura, ambassador al Washington, that neither country desired a total suspension. He sa1c the same feeling obtained regarding thee Netherlands East Indies, where trade negotiations were progressing
 Small Battle Fought
 Shanghai, Aug. 5.-(UP)-Kunic Akiyama, Japanese army spokesman revealed today that smell clash between Russian and Japanese from tier guards occurred two weeks agc near Manchuli, on the Manchukuo- Siberian frontier.
 Akiyama said the encounter oc- cured when Soviet guards crossed into Manchukuo.
 "A few shots were exchanged" ht said, and one Japanese soldier wa: wounded. He said he did not know whether any Russian guards wert injured.
 "Only four or five men were in. volved on each side," the spokes' man said.
 Akiyama said that neither thu Russians nor the Japanese attachec any significance to the outbreak and that no representations hat been made by either side.
 He said that there had been only one or two such clashes since th' big Soviet-Japanese battles at No manhan on the outer Mongoliar frontier.
 A navy spokesman said that ru' mors of Russo-Japanese fighting were being "maliciously inspired fol the purpose of stirring up ToupAe'
 Heavy Bombing
 Pnom-Penh, French Indo-C China Aug. 5.-CUP)-Many heavy Japan csc bombing planes arrived today lin this southwestern Indo-C China city adjacent to the Thailand frontiel region.
 Travellers from Thai reported heavy Thailand infantry and ar tillery concentrations along thu Indo- China border and many ex' cited rumors circulated regarding : possible developments. Japanese artillery and light ar mored units which arrived here las week end left yesterday for an un' known destination.
 (A Tokyo dispatch reported tha Japanese troop units, which prob ably were from the Pnom-Penh arei arrived at 6 town near the iron :. tier)
 Saigon, French o-China, Aug S,-CUP)-A member of the Jap anese military mission here saie today that reports that a British naval squadron. possibly headed D, the battleship Warsplte, was cruis' ing in the Gulf Of siam were "ver. likely.
 French authorities said they hat no knowledge of the reports.