India has a longstanding foreign aid program and with economic growth has come the ability to play like the big boys, even if not with them. Yet, very little information is available, so I decided to do some web research. Here is what I learnt:
Afghanistan as Major Recipient
ITEC is not, however, the only channel for foreign aid. Indeed, large amounts of aid is directed outside ITEC. Afghanistan is by far the largest recipient of that aid. From 2002, to 2006, $650 million had been pledged to India’s Assistance Programme for Afghanistan. The MEA and UN have a list of major commitments:
Other Bilateral Aid
Beyond ITEC and Afghanistan, significant amounts of aid are directed to Africa, much of it delivered in the form of loans, or delivered in-kind as consultancy. Some of these are offered under the India Development Initiative and include (partly drawn from IndiaDaily editorial):
The Broader Context
These figures combined, India’s aid probably stands at over $150-200 million per year, much more than what is provided through ITEC. However, even this inflated figure hides the vast amounts that are invested through private and public enterprises. For instance, India’s oil exploration company ONGC invested $6 billion for railroads in Nigeria (2005). ONGC has also acquired oil assets in Sudan worth more than $750 million.
Even these amounts pale in comparison to China’s beneficence, only to Africa. Late last year China unveiled preferential credit of $3 billion for Africa. China has also provided loans of over $100 million to Ghana and Egypt.
Africa is all too happy to receive this aid which comes with significantly fewer conditions than World Bank, US or EU loans. However, the aid has accompanied a general increase in trade and investment flows between Africa and Asia – particularly China and India.
Fundamentally, however, it reflects a shifting balance of power in the world. India and China have the resources to play power politics, without the conditional rhetoric of ethics, development, and values.
Fore more, see a much updated article on the same subject in the Economic and Political Weekly, April 21, 2009.