SOVIET INSURANCE FOR LON NOL

The American - backed dictatorship of Cambodian General Lon Nol now controls only about 15 per cent of the country's land area and 2 million of its 7 million inhabitants.

It is propped up by an estimated 110,000 South Vietnamese and American soldiers and by massive injections of American aid. The capital Phnom Penh, is surrounded by liberated territory and has recently been hit by daring guerrilla raids, Lon Nol rémains in office only by courtesy of the US Air Force. The only reason the liberation forces have not taken the Cambodian capital is their fear that the US would promptly reduce it to rubble.

Lon Nol may be on his last legs, but he can also fall back on the support of the Kremlin. Moscow maintains a 55-man diplomatic mission in the Cambodian capital and recognizes the puppet dictatorship as the legal government of the country.

The Russian diplomats must find it uncomfortable to live in a city which is regularly bombarded with 122-mm rockets supplied originally to North Vietnam by the Soviet governBut they were doubly embarrassed when a recent US Senate investigation revealed the extent of Soviet aid to the counter - revolutionary regime. The Senate committee on government operations, headed by Senator William Moorhead, discovered that Soviet insurance company was underwriting US military aid shipments to the Lon Nol regime.

Thousands of tons of US aid are brought up the Mekong river under air and naval escort to supply the beleagured Cambodian army. They are insured by the Cambodian National Insurance Corporation, which then reinsures itself with the Russians.

Moorhead's revelations came as something of a shock for Lon Nol's functionaries, too. One official of the Cambodian insurance company complained that now that the arrangement was public knowledge the Soviet insurance company might be forced to bring it to an end.

'The war is good business for us', the official said- -and the profits of the Cambodian National Insurance Company bear him out. The company made a net profit of some 22.5 million riels in 1969, dropping to 18:8 million in 1970 but rising to a new peak of over 27 million riels in 1971 following the US invasion.

Company sources indicate that while the war may have disrupted the economy, insurance is a growth industry. Premiums have been sharply raised and, naturally, profits are up. In practice protection for insured property 1S provided by the Lon Nol armed forces, the South Vietnamese and the US. food slice of the profits finds And one way or another its way into Soviet foreign exchange reserves. War sure is hell but it's good for Top: the American-backed dictator Lon Nol his right-hand man Sirik Matak. Above War Is good for business' and

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