UK gives India £2.3bn in aid despite pledge to stop handouts
Britain has sent £2.3 billion in aid to India since 2016, despite ministers having given the impression that the country would receive no more money, a report reveals.
The Government’s aid watchdog, the Independent Commission on Aid Impact (ICAI), said many people “would be surprised” to see money continuing to go to India at this level.
They said the huge amounts still going to India were poorly targeted, with not enough going towards priorities such as poverty reduction and human rights.
In one example of waste, millions were given to an Indian bank to loan to the poorest – but instead, the bank spent the money on business loans and providing the wealthy with credit cards.
ICAI gave the UK’s India aid programme a score of amber-red, the second-worst available.
Unclear ‘development rationale’
Dr Tamsyn Barton, ICAI’s chief commissioner, said: “India was the 11th largest recipient of UK aid in 2021, receiving more aid than countries like Bangladesh and Kenya, so it is all the more important that every penny is well spent or invested.
“However, we found that the portfolio wasn’t coherent and that the development rationale for it wasn’t clear.
“And while we appreciate that democracy and human rights in India is a sensitive area for the UK, we were surprised to find out that the UK had largely ceased supporting work at the local level.”
In 2012, the British Government pledged to end bilateral aid to India by 2016 as part of a move away from funding middle-income countries.
India has its own space programme and Pranab Mukherjee, the country’s former president, prompted anger in 2012 when he described British aid money as “peanuts”.
But despite the pledge, Britain still sends millions to India in the form of technical assistance, research grants and investments through the Government’s British International Investment (BII) body .
The report from ICAI said: “When BII investments are taken into account, we estimate that India received approximately £2.3 billion in UK aid between 2016 and 2021 although it should be noted that the £129 million of Foreign, Commonwealth and Development Office (FCDO) investments within this figure have generated some returns to the UK taxpayer.
“Many stakeholders may be surprised to see UK aid to India continuing at this level, a decade after the UK announced its transition away from its traditional development partnership.
“While the UK Government stated at the time that development investment and technical assistance (which, in the aid statistics, includes research funding) would continue, the clear expectation was that overall aid volumes to India would decrease faster than they have.”
