Indian financial and technical aid to other countries

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Indian aid, worldwide

Total aid provided by India, 2006-16

Ministry of External Affairs


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India’s grants & loans to foreign countries
India’s aid to ts neighbours
From: September 7, 2019: The Times of India

See graphic:

India’s grants & loans to foreign countries
India’s aid to ts neighbours

2011-16: a country-wise break-up of Indian aid

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Indian aid to neighbours


PREETY BHOGAL | India’s foreign aid to South Asia | Global Policy, cited by ORF


Quantum of aid

During 2009-10, India provided US$ 383.01 million in aid and loans to South Asian countries (except Pakistan), which has expanded to US$ 1,149 million in 2015-16. Out of India’s total foreign aid budget in 2015-16, about 74.6 percent was pledged for Bhutan, followed by 9.1 percent for Afghanistan, 6.6 percent for Sri Lanka, 4 percent for Nepal and 2.8 percent each for Bangladesh and Maldives. The pattern of aid allocation in South Asia has however remained constant during 2009/10 — 2015/16, with Bhutan continuing its reign over the aid budget.

India’s aid programs in South Asia


Driven by similar interests, India has endeavoured to strengthen relations with Afghanistan, which provides an easy route to Central Asia — the hub of energy, minerals and gas resources and access to markets in the Middle East and Europe. India’s foreign aid activities are mainly focused on reconstruction and development of Afghanistan, which would provide security and economic benefits to India in the longer term. Various infrastructure projects, including construction of the Afghan Parliament, Salma dam — hydropower and irrigation project, Zaranj-Delaram highway project (linking Delaram road in Afghanistan to Iranian border Zaranj) have been initiated by the Indian government in Afghanistan with an intention of greater access to country’s energy markets. India’s foreign policy for Afghanistan has significantly changed over time in response to Kabul’s growing centrality in many energy projects such as Turkmenistan-Afghanistan-Pakistan-India gas pipeline project, and the Central Asia and South Asia 1000 electricity transmission and trade project.


Bhutan is a landlocked country and has more than half of its trade with India. In 2015-16, the bilateral trade between India and Bhutan stood at US$ 750.22 million, which represents nearly 55 percent growth over the previous year. Bhutan holds greater significance for India as it is an important source of India’s imports of electricity, base minerals, cement, chemicals and wood products. Particularly, hydropower electricity is central to cooperation between India and Bhutan. A major part of India’s aid to Bhutan during 2016-17 — approximately 78 percent is budgeted for construction of hydropower projects namely 1200 megawatts (MW) Punatsangchhu-I, 1020 MW Punatsangchhu-II, 720 MW Mangdechhu and 600 MW Kholongchhu, among others. Developing large hydropower projects in Bhutan is in India’s economic interests as it gets easy access to cheap electricity, especially during times of power shortages. With escalating demand and competition over energy resources in the world, India is undertaking numerous projects in its neighbourhood for securing reliable and cheap sources of energy supplies.

Neighbourly amity

India is also funding various infrastructure development projects in Sri Lanka, Bangladesh, Nepal and the Maldives. These are typically ‘aid for trade’ projects as they aim at developing these countries’ trade capacity and infrastructure (roads, sea ports and airports), which significantly alters the time and costs of trading with them. Due to limited transport arrangements connecting countries in South Asia, trade costs (or transport costs) are typically high for traders in this region. India intends to reduce the cost of trading by directing aid towards improving regional transport connectivity, especially between north-eastern states in India and landlocked countries like Bangladesh, Bhutan and Nepal. Enhancing connectivity among countries in South Asia fosters regional growth and prosperity.

Besides economic interests, India also has strategic and security interests in South Asia that it pursues through its foreign aid programs. Bhutan, Bangladesh and Nepal share borders with both India and China. ..India is engaging with South Asian countries on a sub-regional level. It has inked motor vehicle agreements with Bangladesh, Bhutan and Nepal, which would provide an easy and seamless movement of cargo, people and vehicles among them…

India… provides untied aid in the form of concessional grants and loans to her neighbours, targeted at infrastructure development. India provides aid to her neighbours in sectors that hold mutual economic-strategic interest, such as transport, energy and democracy. In this manner, India acknowledges the development needs of her neighbours, especially smaller landlocked countries like Bhutan and Nepal. Development cooperation is encouraged in areas with vast potential such as hydropower electricity in Bhutan, road and rail connectivity projects in Nepal. Indian aid programs also do not interfere with recipient’s domestic policies and respect their sovereignty. These programs thus are incongruent to western aid strategy as they have a direct impact on development of the recipient via targeted investment in sectors like energy, manufacturing, connectivity, trade infrastructure etc…

India’s aid projects in countries like Bhutan, Bangladesh and Nepal … the majority of aid is concentrated in developing infrastructure for trade and transport connectivity.

This commentary first appeared in Global Policy


Bhutan grabs dragon's share of aid in Budget

New Delhi:

Indpaedia objects to the word ‘grab.’ Bhutan does not grab anything from India. India and Bhutan are brotherly nations. India is merely trying to be a good brother.

The Times of India Jul 13 2014

Indian aid.jpg

India has helped the kingdom nation Bhutan with grants and loans allocated to the latter going up by nearly 50% -from Rs 4,100 crore in 2013 to Rs 6,000 crore in 2014.

Bhutan has been getting significant financial aid from India by way of grants, both under plan and non-plan expenditure heads. This year, after Modi visited the neighbouring country soon after his swearing-in, the NDA government has significantly increased the financial package. Bhutan was Modi's first foreign visit as PM.

Comparatively, other countries of the South Asian Association for Regional Cooperation (SAARC) have got marginal hikes in grants from the Indian government this year. Even Afghanistan, where India's engagement has increased in recent years, has been allocated Rs 676 crore, not a big hike against last year's Rs 525 crore.

Nepal, with which the PM has expressed his desire to engage more, has not found as much prominence as Bhutan in monetary terms. Among grants and loans to foreign countries, Nepal has got Rs 450 crore as against Rs 380 crore in the previous year. In case of Sri Lanka, the allocation has been Rs 500 crore, an increase of Rs 90 crore from last year.

Bangladesh is the only country in the SAARC region for which the Budget has made lower provisions. The aid for Bangladesh in this Budget is Rs 350 crore, against Rs 580 crore last year.

2014-19: an overview

Angshuman Choudhury, Ashutosh Nagda| How India Funds the World: Financial Assistance in the Immediate Neighbourhood | EPW, Vol. 54, Issue No. 22, 01 Jun, 2019


A look into individual recipient countries gives a clearer picture of India’s donor profile over the past five years. This article series explores, from New Delhi's point of view, the quantum of aid, the logic behind each choice of recipient, the specific target areas and future trajectories. This is explored in the context of the geoeconomic competition that India faces from an increasingly assertive China in a region that was traditionally its own domain of influence.


Bangladesh is perhaps India’s closest partner in the neighbourhood today. Since 2009, when the “pro-India” Awami League government under Sheikh Hasina came to power, New Delhi has shown a greater interest in the bilateral relationship. Both countries have since maintained strong links on a host of fronts, including through co-participation in crucial regional groupings such as the Bay of Bengal Initiative for Multisectoral Technological and Economic Cooperation (BIMSTEC) and the Bangladesh–Bhutan India–Nepal (BBIN) Initiative.

Under the NDA government, the bilateral has seen continuity in good health. However, its budgetary aid spendings to Bangladesh—which have reduced from Rs 197.84 crore in FY 2014–15 to Rs 78.02 crore in 2017–18 (actuals so far)—do not reflect this. Compared to the UPA’s last actuals spending of Rs 604.66 crore in FY 2013–14, these are dismal numbers. Nonetheless, this does not mean that the government has pulled the plug on economic assistance. India has extended two LOCs to Bangladesh since 2014, one worth $2 billion in June 2015 and the second worth $4.5 billion in April 2017. This has allowed the government to reduce core budgetary allocation to Bangladesh under the “budgetary aid” section. Still, the last two allocations in FY 2018–19 and 2019–20 (interim) stand at Rs 120 crore and Rs 175 crore, respectively, indicating a return to earlier numbers.

According to the MEA, most of the budgetary aid money has gone to national and community-level development projects, including construction of educational establishments, dispensaries, deep tube wells, community centres, community clinics and renovation of historical monuments. Notably, the money is also financing three Sustainable Development Projects and the long-pending Agartala–Akhaura rail link, besides other joint connectivity and energy projects.

Despite a strong relationship with Bangladesh, India has reason to worry. According to a 2018 analysis (Bhandari 2018), China has committed $31 billion worth of development money in Bangladesh. It is already working on two large BRI projects in Bangladesh—the Dhaka–Jessore rail line and the Payra power plant, with a third—the Karnaphuli Tunnel—in the offing. Even the proposed 20 km rail-and-road bridge over Padma river, touted as Sheikh Hasina’s dream project, has large amounts of Chinese money involved (Financial Times 2018), although some recent reports indicate otherwise (Chaudhary 2018). While only $1.2 million of India’s $2 billion LoC has been released so far by the EXIM Bank (Byron and Adhikary 2019), the $4.5 billion LoC promised in 2017 remains unused by Bangladesh. The next government in New Delhi must ponder over whether the LoC route is a more effective assistance option over budgetary aid, given the characteristic sluggishness of Indian bureaucracy.


Bhutan’s geopolitical and geostrategic importance to India, as a buffer to China, makes it one of the most important countries in India's attempt to reach out to its neighbourhood. Seen from this perspective, New Delhi's aid to Thimphu has been the highest among other countries in the neighbourhood, although it has been inconsistent.

In 2014–15, the extended aid of Rs 3,260.01 crore was down from the UPA II’s allotment (FY 2013–14) of 3,926.79 crore. In the next FY of 2015–16, the aid amount shot up to Rs 5,368.46 crore. Adding to this inconsistency, the next two FYs— 2016–17 and 2017–18—saw aid dip to Rs 3,441.48 crore and 2,590.14 crore respectively. Interestingly, this coincided with the run-up to the 2018 Bhutanese National Assembly elections, where Indian influence was a key electoral issue. A fall in the amount suggests India's cautious approach. The revised estimate for 2018–19—Bhutan’s election year—remains at Rs 2,510 crore, while the budget estimate for 2019–20 has witnessed a slight increase to Rs 2,615 crore.

Bhutan receives the highest amount of aid from India who has donated $4.7 billion between 2000 and 2017 (Stratfor 2018), reflecting a healthy bilateral. Further, 79% of Thimphu's imports and 90% of its exports are to and from New Delhi, making India, Bhutan’s largest trading partner. The Bhutanese infrastructural development has also witnessed India's active involvement through the building of roads and hydropower projects. For instance, the 336 megawatts Chulkha Hydropower Project, commissioned in 1988, was fully funded by the Indian government. In 2009, India and Bhutan initiated a 10,000 MW Hydropower Development agreement under which several hydropower projects such as the Punatsangchu-I Hydropower Project, Punatsangchu-II Hydropower Project, and the Mangdechhu Hydropower Project were commissioned, all of which are currently under construction (Ranjan 2018).

Notably, India been actively involved in financing much of Bhutan's five-year plans. Out of Thimphu's 10 completed five-year plans,, India completely financed the first two, and its share in the recent Eleventh Five-Year Plan (2-13-2018) is 68% of the total assistance received by Bhutan from external sources. This is unlike India’s financial engagements with any other country.

Nevertheless, India also has many loose ends in Bhutan. New Delhi’s perceived needling in Bhutan's domestic elections, the high rates of interest on loans given to Bhutan, and increasing self-interest in the hydropower projects have negatively impacted its image in Thimphu. China's attempts to woo Bhutan are also cause for concern. Traditionally, Bhutan has avoided an explicit tilt towards China, a prime example being its refusal to accept China's package deal in1996 to settle the border dispute, borne from China’s annexation of Tibet in 1959 (Bisht 2010). Yet, China's soft power offensive—there has been a boom in Chinese tourists visiting Bhutan, scholarships have been extended to Bhutanese students, Chinese artists and Chinese sportspersons are also sent to Bhutan (Ramachandra et al 2018)—and its growing economic clout in the country may convince Bhutan to normalise ties with China, and also gain economic benefits and strengthen its sovereignty. India needs to be careful in its dealings with Bhutan; a hardline approach will see it yet lose another South Asian country to China, with Bhutan being the most important one owing to the border dispute.


As one of the first countries to recognise Maldives' independence, India has maintained a strong historical relationship with the Indian Ocean island nation. Maldives’ importance to New Delhi lies in its strategic geographical location—located 700 km from the Lakshadweep islands and 1,200 km from India's mainland, it is a crucial geostrategic and geoeconomic nodal point, particularly within the ambit of the NDA government’s SAGAR policy.

The NDA oversaw a rough phase of the bilateral relationship between India and the Maldives, due to the latter’s political instability. Abdulla Yameen’s election as president in 2013 heralded a particular low point, with his pro-China tilt. However, with President Ibrahim Solih coming to power in 2018, normalcy has returned between the two nations.

Interestingly, India's aid to the Maldives, minuscule in comparison to the aid provided to other nations, did not witness any slump during the Yameen years, which coincided with the first four years of the NDA government. In 2014–15, Indian aid was Rs 26.08 crore, which was significantly lower than the Rs 165.77 crore spent in the previous year (FY 2013–14) under UPA in a mixed loan-grant format. The next three FYs saw a consistent rise in India's foreign aid, reaching up to Rs 109.24 crore in 2017–18. The budget in the next FY witnessed a significant jump to Rs 440 crore and the surge continued with an estimate of Rs 575 crore in 2019–20.

India has played a key role in the establishment of institutions in the health and education sectors in the Maldives. India has continuously supported the development of human resources in the Maldives including capacity building programmes, and provision of training and scholarship opportunities.

But, the past five years has made it amply clear that India needs to be cautious of China’s rapidly growing clout in the region. Between 2013-2018, Maldives tilted heavily towards China, but the recently elected Solih government has brought back Male's “India-first” policy. India, on its part, has pledged financial assistance of $1.4 billion in the form of budgetary support, currency swap agreements and concessional lines of credit (Miglani 2018). Despite a current lull in tensions, Maldives' domestic politics still remain uncertain and a sudden change in government could once again tilt the country towards China, which could change the geostrategic dynamic in the Indian Ocean.


Under the NDA government, India has renewed its diplomatic push towards Southeast Asia, within the ambit of the flagship Act East Policy (AEP). Through this policy prism, Myanmar forms a critical strategic link, especially with the coming of a democratically-elected civilian government in Naypyitaw under Aung San Suu Kyi. In AEP parlance, Myanmar is India’s “land bridge” to Southeast Asia and its lucrative markets (Yhome 2016).

Thus, the steady increase in India’s grant assistance to Myanmar is hardly surprising. Between the 2014 and 2019 interim budgets, a combined total of Rs 1,286.03 crore was spent in actuals or was allocated for future spending. Although the government started in a ditch with an actuals spending of just Rs 51.79 crore in FY 2014-15 (as compared to Rs 164.86 crore in the previous FY under UPA-II), the money spent gradually rose to Rs 223.55 crore in 2017-18. The next two FYs saw even loftier estimated allocations of Rs 370 crore (2018-19) and Rs 400 crore (2019-20, interim budget), the highest amount of aid ever extended to Myanmar by India.

The core assistance money went to a host of sectors, including but not limited to health, education, capacity building, agriculture, physical connectivity, digital connectivity, and post-conflict reconstruction. A significant chunk of the allocation is dedicated to Small Development Projects (SDPs), with a special focus on border development projects. Separately, the EXIM Bank also gave the Myanmar Foreign Trade Bank (MFTB) an LoC of $198.96 million in 2015 for irrigation projects (Economic Times 2015).

The central idea here is to invest in building institutional and physical capacity in Myanmar and thus retain geoeconomic leverage—a foreign policy objective made even more imperative by China’s rapid strides into Myanmar. Over the past decade, Beijing has rapidly consolidated its economic and political clout in the country through large infrastructure projects under the BRI, and by providing logistical support and political backing to warring ethnic armed groups in northern Myanmar. It has already signed a comprehensive agreement for a China–Myanmar Economic Corridor (CMEC) to connect its Yunnan Province to Myanmar’s southern coast along the Rakhine State (Thiha 2018). In comparison, India’s engagement in Myanmar remains siloised, small-scale and predominantly economic in nature. Slow implementation has impeded progress too, unlike China’s hyper-fast project deadlines. Yet, the current level of grants, if sustained, could bear significant geopolitical returns for India in the longer run as Myanmar’s diplomatic profile expands.


The NDA government’s bilateral relationship with Nepal, once considered among one of India’s most trusted regional partners, has been rough. Over the past five years, New Delhi has watched with bated breath as Kathmandu drifted closer into China’s swelling sphere of influence. Combined with the 2015 Madhesi crisis and the ensuing border blockade, allegedly enforced by India, relations have soured between both countries.

Interestingly, tense relations between the two countries have not affected India’s core aid assistance to Nepal. India has spent a total of Rs 1,322.53 crore between 2014–15 and 2017–18 in the country, with an average actuals spending of Rs 330.6 crore. In fact, the degree of Indian aid assistance to Nepal has not seen any significant interruption despite a government change in New Delhi, as evinced by the last actuals spending of Rs 381.37 crore by UPA-II in 2013–14. Even through the roughest phase (read: 2015), aid allocation only scaled higher, with India spending Rs 6.68 crore more in 2016–17 than in 2015–16. According to the MEA, Indian aid money in Nepal is aimed at creating “infrastructure at the grass-roots level” and facilitating projects “in the areas of infrastructure, health, water resources, education and rural and community development.”

Further, the EXIM Bank extended an LOC worth $1 billion (PTI 2015) in 2015 for the “financing of hydropower, irrigation and infrastructure development projects” and another LoC worth $750 million in September 2016 for post-earthquake reconstruction (Economic times 2017), part of which Kathmandu wishes to use for other developmental projects. (Kathmandu Post 2018). In addition, India extended a total of $67 million to Nepal as part of post-earthquake relief-and-rescue efforts in April 2015, followed by another aid package of $1 billion in 2015. Further, in July 2018, New Delhi handed over a second hefty package of 2.1 billion Nepalese Rupees to Nepal for house reconstructions (ANI 2018).

In many ways, the NDA government has relied on these aid disbursements (besides three states visits in four years) to sustain relations with Kathmandu in the face of diplomatic hiccups and to thwart deeper Chinese ingresses. The amounts earmarked in the last two budgets—Rs 750 crore in 2018–19 and Rs 700 crore in 2019–20 (interim)—categorically reflect the current government’s renewed push to resuscitate an under-the-weather bilateral, and perhaps even to exorcise the ghost of 2015 for good.

Despite this charm offensive, China’s clout in the Himalayan nation remains undented. In fact, it is steadily growing, hastened by a communist-led coalition coming to power in Kathmandu in 2017. Both countries have since signed a comprehensive agreement under the BRI in 2017 to engage in a range of sectors, including internal and trans-Himalayan connectivity, aviation, medicine, communications, hydropower, and tourism. Further, they recently signed the protocol of the Nepal-China Transit Transport Agreement (TTA) (Xinhua 2019a), which allows landlocked Nepal to access Chinese sea and land ports, thus weaning Nepal’s geoeconomic dependency on India. What’s more, China remains the highest FDI source for Nepal, with the latter reportedly receiving a total of $505 million in Chinese investments in less than a year (2017-mid 2018).

Given the heft and scope of Chinese projects in Nepal, India needs to do much more than just focus on “grass-roots level development” in order to level the geopolitical dynamic.

Sri Lanka

Sri Lanka’s geopolitical and geostrategic importance to India is clear: it is a critical nodal point in the Indian Ocean and a time-tested partner in the neighbourhood. Despite many past hiccups, New Delhi has always valued its bilateral with Colombo as an important subcontinental relationship. Thus, the island–nation fits perfectly with the NDA government’s “Neighbourhood First” policy. However, as is the case with most other countries in the neighbourhood, India faces a frontal challenge from China in sustaining its influence in Sri Lanka. In fact, during the NDA’s term, the island nation became a geopolitical flashpoint for a visible New Delhi-Beijing competition over critical geoeconomic assets. The budgetary aid figures, put in this volatile context, are interesting.

While foreign aid spending in Sri Lanka initially increased under the NDA government—New Delhi spent Rs 499.7 crore in 2014–15 and Rs 403.8 crore in 2015–16, compared to the UPA-II figures of Rs 248.2 crore in 2012–13 and Rs 420.8 crore in 2013–14—it witnessed a sudden drop: India spent a meagre Rs 99.16 crore in 2016–17 (as against an estimate of Rs 155 crore), followed by an even lower figure of Rs 77.89 crore in 2017–18 (as against an estimate of Rs 75 crore). Subsequently, these figures have climbed back up modestly, with New Delhi allotting Rs 165 crore in 2018–19 and Rs 150 crore in 2019–20. The actuals figures are yet to be published.

These figures are intriguing when seen against the attendant political churnings. Initially, there was much chatter about how the NDA government might increase foreign aid to the Mahinda Rajapaksa government in Colombo (Roche 2015), despite the latter’s visible pro-China tilt. However, the 2015 national election saw the elected president Maithripala Sirisena, who was critical of the sitting government’s pro-Beijing policies. For New Delhi, this was good news. What then could explain the rapid dip in aid? Did India believe it was no longer necessary to spend large sums of money in the island country as geopolitical incentive, now that a more pro-India leader was in power? Or, was it due to pragmatic reasons, such as land acquisition hurdles, as some analyses suggest (Stratfor 2018)? Interestingly, the upward climb in aid allocations from FY 2017–18 came after President Sirisena signed the $1.1 billion debt-for-equity deal on Hambantota Port with China in July 2017 (PTI 2017b), permitting the latter to operate the strategic port on a 70% stake for a 99-year lease period. This was certainly a cause of concern for India, which probably wanted to regain lost ground in bilateral ties with higher aid allocations.

A large sum of India’s aid to Sri Lanka goes into “infrastructure development, housing and shelter, water and sanitation, livelihood, education, research and training, healthcare, industrial development, arts, culture and sports etc” (Ministry of External Affairs 2017). Amongst these, the nearly–complete Rs 1300 crore housing project for Tamils displaced during the civil war, which commenced in 2012, is India’s single largest investment in the country (Economic Times 2012). India has also extended a total of $1.3 billion as an LoC for development of Sri Lanka’s railway sector, with the latest pact signed in June 2017 (Hindu Business Line 2018). On aiding the island partner, New Delhi has always emphasised on the South-South Cooperation template, projecting Colombo as a development partner rather than as an aid recipient country.

However, despite India’s efforts and Rajapaksa’s ouster, Chinese influence in Sri Lanka is expanding: China has managed to push several big ticket projects in Sri Lanka under the BRI banner, including the construction of a port city in Colombo, the development of the Hambantota Port and industrial park, multiple expressways, and a power station (Xinhua 2019b). With these, Beijing has ensured the creation of profitable assets that are bound to incur massive geoeconomic and geostrategic returns in the future.


Rohan Dua, India’s aid to Nepal up 73% to check China’s infra push, March 21, 2018: The Times of India

The Centre has decided to hike its financial aid for the financial year beginning April 2018 to Nepal to Rs 650 crore, a 73% increase from the previous year allocation, while expressing concern over increasing Chinese presence in some of the neighbourhood countries.

India’s aid to Nepal in 2017-18 financial year stood at Rs 375 crore.

However, the largest allocation of aid by India has yet again been kept for Bhutan at Rs 1,813 crore, which is part of the five-year commitment to help the royal government build hydro-electric projects at Punatsangchhu, and Mangdechhu among other infrastructure works.

Bhutan had firmly stood behind India when its troops and China were locked in a 73-day-long standoff in Doklam from June 16 last year after the Indian side stopped building a road in the disputed trijunction by the Chinese Army. Bhutan and China have a dispute over Doklam. The face-off ended on August 28.

This has been disclosed in the parliamentary committee report on external affairs tabled last week.

“China is making serious headway in infrastructure projects in our neighbourhood. Specifying the strategy devised to counter increasing Chinese presence in our backyard, the government is committed to advancing its development partnership with Bhutan and Nepal, as per their priorities,” the report says.

“The allocation of funds under to Bhutan and Nepal for 2018-19 is a reflection of our expanded development partnership with the two countries and continued emphasis on expeditious implementation of our ongoing projects, in consultation and coordination with the respective governments, for mutual benefits,” it adds.

In a response to the panel on whether the sharp rise in allocation to Nepal is a strategic step to counter growing Chinese influence, the report states, “India and Nepal have close cultural and civilisational ties and a wide-ranging and expanding partnership across diverse sectors, which stand firmly on their own.”

The report points out security concerns on the Indo-Nepal border among reasons to hike the aid. Detailed project reports have been prepared for the Integrated Check Posts at Nepalgunj and Bhairahawa in Nepal.

India’s technical cooperation programme

The Indian Technical And Economic Cooperation Programme


The Indian Technical and Economic Cooperation (ITEC) Programme was instituted by a decision of the Indian Cabinet on 15 September 1964 as a bilateral programme of assistance of the Government of India. The decision regarding setting up the ITEC programme was predicated on the underlying belief that "it was necessary to establish relations of mutual concern and inter-dependence based not only on commonly held ideals and aspirations, but also on solid economic foundations. Technical and economic cooperation was considered to be one of the essential functions of an integrated and imaginative foreign policy."

The ITEC Programme is essentially bilateral in nature. However, in recent years, ITEC resources have also been used for cooperation programmes conceived in regional and inter-regional context such as Economic Commission for Africa, Commonwealth Secretariat, UNIDO, Group of 77 and G-15. In more recent years, its activities have also been associated with regional and multilateral organizations and cooperation groupings like Association of South East Asian Nations (ASEAN), Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC), Mekong-Ganga Cooperation (MGC), African Union (AU), Afro-Asian Rural Development Organization (AARDO), Pan African Parliament, Caribbean Community (CARICOM), World Trade Organization (WTO) and Indian Ocean Rim - Association for Regional Cooperation (IOR-ARC) and India-Africa Forum Summit.

The ITEC Programme, fully funded by the Government of India, has evolved and grown over the years. Under ITEC and its sister programme SCAAP (Special Commonwealth African Assistance Programme), 161 countries in Asia, Africa, East Europe, Latin America, the Caribbean as well as Pacific and Small Island countries are invited to share in the Indian developmental experience acquired over six decades of India's existence as a free nation. As a result of different activities under this programme, there is now a visible and growing awareness among other countries about the competence of India as a provider of technical know-how and expertise as well as training opportunities, consultancy services and feasibility studies.


Country-wise breakup of India’s technical cooperation budget,The Times of India

See graphic 'Country-wise breakup of India’s technical cooperation budget, 2013-14'

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