Wednesday, March 15, 2023

UK continues to provide indirect giveaways to India under the guise of "commercial

UK still gives aid to India dressed up as ‘business investments’ rather than direct handouts: Britain watchdog

 LONDON: A review conducted by the UK aid spending watchdog has revealed that approximately £2.3 billion (Rs 23,000 crore) in UK aid went to India between 2016 and 2021. In 2012, India's then-finance minister, Pranab Mukherjee, famously referred to Britain's annual £280 million (Rs 2,798 crore) aid to India as "peanuts," and British critics at the time questioned why Britain was providing aid to India when India was funding its own space program The Indian government stated in 2017 that it received more foreign aid than it gave.

A gradually eliminating of monetary guide by 2015 was properly embraced as UK government strategy in 2012.

However, in its review of UK aid given to India on Tuesday, the Independent Commission for Aid Impact (ICAI), which is independent of the government and examines UK government aid, stated, "We calculatethat the UK provided around £2.3 billion in aid to India between 2016 and 2021." This amount includes £441 million in bilateral aid, £129 million in development investments made through the Foreign, Commonwealth, and Development Office (FCDO), £749 million in aid from multilateral organizations, and £1 billion in investments made through British International Investment (BII), the UK's development finance institution. According to the report, "BII is the oldest development finance institution in the world. It was founded in 1948 as the Colonial Development Corporation with the mission to do good without losing money." It has 389 investments in India, which will be worth £2.3 billion in 2021. India is its largest country portfolio, accounting for 28% of the total.

“Seeing UK aid to India continue at this level a decade after the UK announced its transition away from its traditional development partnership may surprise many stakeholders. According to the report, "the clear expectation was that overall aid volumes to India would decrease faster than they have," despite the fact that the UK government stated at the time that development investment and technical assurance would continue.

According to the report, "even though there are still substantial volumes of UK aid to India, it is now very different in nature and purpose." According to the report, "it serves as a tool for UK foreign policy, diplomatic, and trade objectives, supporting a variety of the 2030 UK-India Roadmap objectives." The provision of basic services to India's poorest states, such as health care and education, is no longer the primary focus of UK aid to India. Instead, the aid is now primarily directed toward climate, infrastructure, and economic growth.

The report provides examples of how UK aid to India is not properly targeted. For instance, a significant investment made by BII in a medium-sized Indian bank was not used to expand the bank's entire business, particularly credit cards, but rather to support inclusive growth through the expansion of the bank's microfinance lending. The UK India aid program received the second-worst possible score from ICAI, an amber-red rating.

“A stronger bilateral relationship with India is the overarching objective of the UK, and aid is being utilized in a variety of ways to support that partnership. As a result, there is no compelling development justification for the portfolio's fragmentation. Although the aid portfolio may be supporting bilateral relations between the UK and India, it does not have a strong connection to poverty reduction, which is still the statutory goal of UK aid. We are also concerned that, as indicated by global indices, the United Kingdom has largely chosen not to address India's growing challenges in the areas of democracy, human rights, and civic space since 2017.

A spokesperson for the FCDO said: The Indian government has received no financial assistance from the UK since 2015. Right now, the majority of our funding is going toward business investments that help India and the UK develop new markets and jobs. Investments from the UK are also contributing to the solution of shared problems like climate change.

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