Strategic Altruism: India Gives Foreign Aid

Dominantly understood as an international transfer of financial resources; aid may also take diverse forms in the international sphere including technical assistance, training, or commodities like food and military equipment. The impetus that governs the global flow of aid may range from altruism to strategic partnerships premised upon economic factors. It might look like long-term development partnerships to foster strong bilateral relations or targeted humanitarian aid for relief as an aftermath of a calamity. Aid occupies a paramount position in the country’s Foreign Policy. India’s status as a developing country has never posed as an impediment in its active allocation of aid to multiple other countries, particularly to Bhutan, Afghanistan, Bangladesh, Nepal, Myanmar, and the Maldives. The past decade has witnessed an amplification in the granting of aid by India to its neighboring regions to forge strategic partnerships in South-Asia and competing with China’s growing influence in the region.

India’s Grant-in-Aid

According to the Ministry of External Affairs, a number of grant-in-aid projects, aggregating around US$ 4 Billion, covering various sectors such as infrastructure, hydroelectricity, power transmission, agriculture, education, health, industry, etc., as prioritized by the host governments, are under implementation in Afghanistan, Bangladesh, Bhutan, Myanmar, Maldives, Nepal Sri Lanka, Mauritius, Seychelles, and other countries. NDA’s flagship “friendly Neighborhood Policy” is built on the rationale of-  ‘Security and Growth for All in the Region’. A plethora of projects has been completed with India’s assistance. These include the construction of the Afghan-India Friendship Dam in Afghanistan, the Construction of the Afghan Parliament Building in Kabul, the construction of the new ENT hospital project in Mauritius, the Metro Express Project in Mauritius, Jaffna Cultural Centre in Sri Lanka, and the Supreme Court building in Mauritius.

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Despite its limited resources and high population, India claims to extend support to other developing countries in the spirit of “VasudhaivaKutumbakam”. Additionally, India’s experience of colonization helps in forming relations with other former colonies. Unlike most Western nations, India’s extension of aid does not meddle with the culture and agency of the receiving nation but in fact, is guided by their priorities.  Prime Minister Modi, in his address at the Parliament of Uganda in July 2018 said, “Our development partnership will be guided by your priorities. It will be on terms that will be comfortable for you, that will liberate your potential and not constrain your future…” At the same time it grants India stability and security through its relations.

A Case Against Aid

Multiple scholars have staunchly opposed the concept of foreign aid due to the power hierarchy that builds up between nations and the beneficiaries can be manipulated through this kind of transaction. Kenan Mallik, in an article in The Guardian, argues that it is not unadulterated altruism that motivates aid. In the context of the UK and US, the top recipients of aid do not include the poorest countries like Mozambique, Uganda, and Haiti but Pakistan, Israel, and Syria. Although it is fairly obvious that aid fosters relationships in the longer term, it is the excessive conditions of the aid granting nations, that Mallik argues against. “Half of all international development aid is “tied”, meaning that recipient countries must use it to buy goods and services from the donor nation”, he says. The USAid website stated, “Close to 80% of the US Agency for International Development’s contracts and grants go directly to American firms.” Aid is then reduced to a tool for trading and in cases of aid in the form of loans, even as a way of ‘colonizing’ developing countries. Britain, for instance, has traditionally given most of its aid as loans. Even China uses aid as leverage over economically weaker nations to pursue its ‘expansionist’ policies and ties aid to the purchase of Chinese products.

India Promising Hope

Where does India feature in these skewed dynamics?  India’s status is starkly different from that of most countries that offer aid as merely a weapon of trade and influence. And though it seeks to emerge as the leader in South- Asia, India’s policy remains one of leading and not ruling the region. Perhaps it is a consequence of a shared experience of colonization or India’s precarious status due to the constant competition with China. One interesting case could be that of Nepal. The latest rough patches with respect to the border and resources have not altered the traditional aid granted to Kathmandu. It has neither been reduced nor tied with stern policies to counter China’s impact. With its average actuals spending being 330.6 crore, India’s last actuals spending was Rs.  381.37 Crore.

According to the MEA, Indian aid money in Nepal is aimed at creating “infrastructure at the grass-roots level” and facilitating projects “in the areas of infrastructure, health, water resources, education and rural and community development.” Additionally, at a point in time when the world is suffering disproportionately due to the unprecedented Coronavirus pandemic, India has emerged as a stable source of support for multiple countries. Medical assistance including testing kits, protective gear, and Hydroxychloroquine, and other medicines have been dispatched to around 90 plus countries across the globe. This kind of horizontal assistance- humanitarian and developmental, free of excessive power hierarchies is a promising future for foreign aid, particularly in South Asia.

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