Britain’s aid to India: explained

Should we continue giving aid to India? Photo by Emily Wight

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The question of aid to India has been circulating around Britain recently.

In this article, Blog Officer Emily Wight puts forward the basic facts so that you can make up your own mind – does India still need help? And should that help come from a country steeped in its own economic crisis?

How much does the British government give to India per year?

Britain’s Department for International Development (DfID) is giving £280m ($444m) worth of aid toIndiauntil 2015. The pledge is part of a commitment to the United Nations Millennium Development Goals (MDGs), which has led to the world’s richest countries pledging to spend 0.7% of their Gross Domestic Product (GDP) on foreign aid before 2015.

The UN states, “If every developed country set and followed through on a timetable to reach 0.7% by 2015, the world could make dramatic progress in the fight against poverty and start on a path to achieve the Millennium Development Goals and end extreme poverty within a generation.”

How does the figure translate in real terms?

£280m of public money could pay for:

  • The National Health Service (NHS) to remove over 100,000 risky Poly Implant Prothese (PIP) breast implants, more than twice the 50,000 believed to be fitted in British women
  • The employment of over 112,000 trainee police officers on Britain’s streets
  • 31,000 students to attend UKuniversities for a year, according to the recent rise in tuition fees

Despite its economy growing at nearly 10% per year, India is steeped in poverty. Photo by Emily Wight

Why would India need aid?

According to DfID, a third of the world’s population living below the World Bank’s extreme poverty line live in India.

The World Bank has classified India as a Middle Income Country (MIC), but many advocates of aid donations claim that this is irrelevant, as 72% of the World Bank’s classified poorest people live in MICs.

According to the BBC, more people live in poverty inIndia than in the entirety of sub-saharanAfrica.

The prominent Indian political analyst Praful Bidwai said: “In reality, since 1991, during which timeIndia has experienced the highest growth in recent history, there has been no significant reduction in poverty or hunger. Two in every five children remain malnourished. A third of adults have an abnormally low body-mass index. Half of women of childbearing age are anaemic, a proportion far higher than in sub-Saharan Africa. More than 500 million Indians have no electricity, and less than a third have toilets.”

Why do some people have a problem with UK aid to India?

The latest round of attacks on the UK’s aid programme to India comes from a Sunday Telegraph article entitled “India tells Britain: we don’t want your aid” in which it is revealed that India’s Finance Minister Pranab Mukherjee called the UK’s annual £280m “peanuts” in India’s total development expenditure. However, this attack was made last year and DfID claim that the aid programme has been revamped since then.

Many critics of the budget to India cite the country’s nuclear weapons arsenal and advanced space programme. According to Conservative MP Philip Davies,India spends £36bn ($57bn) a year on defence and £750m ($1,187m) a year on its space programme.

Commentators also think it unfair that the Indian Air Force refuses to buy Typhoon jets, partly built in Britain – instead spending an estimated £13bn ($21bn) on French fighter jets.

The BBC claims thatIndiagave more than £300m ($475m) in aid to poorer countries in 2008. Some people see this as evidence that India no longer needs aid from other countries.

Furthermore, India’s economy is growing at nearly 10% per year; according to Forbes, it has more billionaires than the UK.

Women’s empowerment projects are funded by the UK government. Photo by Emily Wight

Where does the money go?

DfID insists that they are working in three of India’s poorest states – and half of the money is directed at “pro-poor private sector investment”, which they say will benefit both the Indian and British taxpayer.

DfID works with the Indian government in programmes directed at coping with climate change, and women’s empowerment. Because India is so huge, DfiD has also partnered with specific state governments to help their individual programmes – such as this health programme in Orissa.

Comments from politicians:

Unlike many issues that spark political debate in the UK, the question of aid to Indiais not clear-cut between a right/left divide. After all, DfID is headed by Conservative MP Andrew Mitchell, who defends his department’s efforts:

“India itself has got 60 million children into school in recent years with their own money but more than 30 per cent of the world’s poorest people live there.

There are states the size of Britain where half of all children suffer from malnutrition. We will not be inIndiafor ever but now is not the time to quit.

Our completely revamped programme is in Indian’s and Britain’s national interest and is a small part of a much wider relationship between out two countries.

We are changing our approach toIndia. We will target aid at three of India’s poorest states, rather than central Government. We will invest more in the private sector, with our aid programme having some of the characteristics of a sovereign wealth fund.”

However, according to Conservative MP Peter Bone, “India has its own foreign aid programme so it is absurd for us to be still giving them aid. They are more than capable of looking after their own issues.”

What does the press say?

Unlike the political parties, the British press is divided in its consideration of UK aid to India. Writing in the left-leaning Guardian, Praful Bidwai said, “Numbers such as 8% growth, and the fact there are 153,000 dollar millionaires, mean little to most Indians.” He also said that aid should be “about poor people, not poor countries.”

Meanwhile Rahul Bedi, writing in the right-wing Daily Mail, said, “The programme is unnecessary, patronising and counter-productive. It smacks of an outdated, colonialist mindset rather than modern economic reality.”

Several Telegraph readers also wrote to the right-wing newspaper saying that India should not continue to receive aid from the UK.

Follow Emily on Twitter: @emily_wight


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