Aid give-and-take: India put foot down during Cameron visit

British Prime Minister David Camerons recently concluded visit has prompted a rethink at high levels of the government on the ticklish issue of accepting foreign aid....

British Prime Minister David Camerons recently concluded visit has prompted a rethink at high levels of the government on the ticklish issue of accepting foreign aid,particularly from London. In fact,sources said,there was nearly a diplomatic row after India refused to have any kind of aid or donation announced during the visit,especially in the official joint press statement.

It is learnt that the point was raised by the Finance Ministry in the run-up to Camerons visit,after UK authorities had put forward certain funding proposals for announcement. Citing the recent debate in London over allegations that some of its funds had been misused in India,followed by calls for reconsidering aid to New Delhi given its rising economic profile,the Finance Ministry is said to have asserted that India should take the lead and decide whether it needs aid at all from countries like the UK.

As of now,projects worth around 250 million pounds are operational in India through aid from British agencies like the Department for International Development DFID. The findings of a 2004 CAG report on the Sarva Shiksha Abhiyan 8212; to which the DFID contributes a marginal 2 per cent funding 8212; had prompted UK International Development Secretary Andrew Mitchell to make strong remarks about reviewing aid to countries like India.

The Finance Ministry is said to have argued that India ought to have its own policy on accepting or rejecting aid before an embarrassing decision is thrust by a foreign government because of its own internal politics,like the UK. This suggestion,sources said,was also taken seriously because the Finance Ministry felt India no longer requires such aid or assistance to run its development programmes.

While this larger question is still under inter-ministerial deliberation,the issue had its impact on Camerons visit. The Ministry of External Affairs felt that any firm refusal or rejection,without a proper policy in place,could have a negative bearing on the visit. The middle ground reached was that the UK was welcome to provide funds to projects it may have identified,but no specific amount would be announced in the joint press statement. The decision is said to have not gone down too well with London.

So,for instance,the UK was apparently keen on announcing 50 million pounds assistance to certain bio-technology and non-renewable energy projects,but this was taken off at Indias instance from the joint press statement. Instead,in case of bio-technology,the statement just specified the initiative of the Department of Biotechnology and the London-based Wellcome Trust to come together in a new collaboration to support the development of innovative healthcare products at affordable costs.

Similarly,in the case of renewable energy,the statement only mentioned that both sides agreed to explore initiatives that will create resources and incentives to help businesses deploy renewable energy,particularly for the poor.