I took my Dutch units and retreated them to Babar Island which I hoped to make a stronghold.
I play in a "roleplaying" mode so I had certain restrictions. Units retreated to Babar had to have been salvaged from elsewhere - typically picked up by seaplanes as fragments of defeated units and deposited here - with supplies from Australia, set to rebuild as much as possible.
It is a ragtag stack of units with too much support and not enough combat units. The Japanese have been landing troops on the island and now have them outnumbered. Supplies are dwindling and, with a constant enemy patrol around the island, I can only get supplies in by submarine.
But, it is nearly October, 1942, and they still live.
Again, because I play in a "roleplaying" mode, I cannot choose to simply leave them there without hope of aid. So, I am now mounting a "Malta" style relief expedition, complete with aircraft carriers, transports, and the ferrying in of land-based fighters right before the relief expedition shows up.
How did this stand turn out for you? I have my remaining Dutch combat and support troops along the N. Australian coast. They aren't much but their base ops and AA have helped me keep the LOC open from Perth to Darwin.
After ignoring this region of the war for 10 months, it seems the attempt to relieve the island caught Japan by surprise.
As the allied ships got into position, Japan had a number of lightly-escorted ships off the coast supplying their own (50,000) troops. The Australian and Dutch shore-based guns would fire at the Japanese supply convoys from time to time, with little effect.
The allied supply situation had deteriorated significantly by this time. Dutch and Australian soldiers had just gone to half rations, and there was no way the island could host an air squadron.
The battleships arrived first. They encountered two small transport task forces in the dark, then bombarded the Japanese on the island - and retreated back to Darwin.
At dawn, the torpedo bombers came in off of the carriers and inflicted some more damage on the ships. Japan's capacity to transport cargo in this region has been severely diminished.
The fighters that were supposed to go to Babar stayed in Darwin and flew long range CAP over the carriers.
Japanese attacks managed to land hits on the HMS Repulse (which will be out of the war for six months), one carrier (under repair for 1 more month), one destroyer (that underwent emergency repairs of all non-major damage at Darwin and is now limping to a drydock at Melbourne), and one transport.
Because of the supply situation (and the fear of a counter-attack), the battleships and carriers could not stay long - they retreated back to Perth.
However, with the additional supplies, two Australian squadrons flew to Babar to guard the island. Their numbers are augmented by a squadron of Beaufighters based in Darwin.
Japanese Zeros inflicted some serious harm on them - but took some casualties in return (at a ratio of 1 Japanese for every 2 Australians).
The Dutch navy has been guarding two APs (out of the original four) delivering supplies out of Darwin. Nine APDs also contribute to supplying the island.
Just three days ago, a task force consisting of five large AKLs reached Babar. In two days, they will be completely unloaded.
There are now 16,000 AE-"tons" of supplies on the island. The troops are eating well, and there is enough ammunition to shell the Japanese that sit outside the Allied stronghold.
It could have been much worse - but Japan seems to be focusing its efforts on Burma and the Solomons. Admittedly, the allies have not planned any major offensives on this front. The intent was just to form a stronghold where the Dutch could hold out - and to provide a road bump for Japanese assaults on northern Australia.