On February 27, 1946, Mongolia and the Soviet Union signed the ten-year renewable Treaty of Friendship and Mutual Assistance and the first Agreement on Economic and Cultural Cooperation. With the war over and Chinese and Japanese threat eliminated from Mongolia, the way for renewed assertion of Soviet influence in Mongolia was clear. Mongolia was a strong defense buffer, a trading partner, and a dependable ally in international conferences for the Soviet Union. A further indication of close ties was Mongolia's adoption in February 1946 of the Cyrillic alphabet for use in schools and military units.

Secure in its relations with Moscow, Ulaanbaatar expanded its other international ties. Diplomatic relations were established with the Democratic People's Republic of Korea (North Korea) and the new communist governments in Eastern Europe. Mongolian participation in communist-sponsored conferences and international organizations increased; Mongolia applied for membership in the United Nations, but representatives from Ulaanbaatar were not seated until 1961. Mongolia was among the first countries to recognize the new People's Republic of China in October 1949.

In its shift to postwar development, the party and the government reduced defense expenditures and shifted personnel from military to civilian enterprises. Rationing was curtailed, and prices for some manufactured items and foodstuffs were reduced. Attention was given to redeveloping the livestock and the agrarian sectors at the same time that modern mining, industrial, transportation, and communications sectors were being established. Initiatives also were taken in raising education and health levels and in improving the general well-being of the people. The First Five-Year Plan (1948-52), presented at the Eleventh Party Congress in December 1947, was important in carrying out postwar construction. The first session of the national hural held since 1940, was convened in February 1949 as the Ninth National Great Hural.

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Source: U.S. Library of Congress