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US may reduce aid to 'donor' India

Bush's proposed $2.9 tn budget for 2008 seeks more aid for Afghanistan and Pakistan, but a cut for India.

india Updated: Feb 06, 2007 13:10 IST

US President George Bush's proposed $2.9 trillion budget for fiscal year 2008 seeks $20.3 billion for foreign assistance with increases for Afghanistan and Pakistan, but a cut for India as it has become a "donor country".

Seeking a 12 per cent increase in fiscal 2008 starting October 1 over the enacted 2006 fiscal, the proposal lists Israel, Egypt, Afghanistan, Pakistan, Sudan, Indonesia and Kosovo among the top recipients of US aid.

However, Israel and Egypt's assistance levels are being reduced as stipulated under the 1978 Camp David agreement, and that many programmes for India, which itself has become a donor country, would be cut, Randall Tobias, administrator of the US Agency for International Development (USAID) said on Monday.

"A lot of the cuts that were made are cuts in programmes where we've really gotten to the point where - India, for example, is a country that has an economy that's growing by 8 per cent. India has become a donor country.

"India is providing like $50 million, I think, in support for Afghanistan. And so India is in a position where they are taking on more of the burden for the problems facing India. We still have a major programme in India, but it is reduced in '08 from what it was in '06," Tobias said by way of explanation.

The United States has been "a leader in championing human dignity and human potential," and its commitment to global development is evidenced by its level of development assistance "nearly tripling ... from approximately $10 billion in 2000 to $28.5 billion in 2005, " he said.

The 2008 budget request, which is subject to further action by the US Congress, "continues that commitment, but it does so in what we believe is a much improved and much more strategic way," Tobias said.

The amount does not include funding for security and reconstruction efforts in Afghanistan and Iraq, which will fall under the Bush administration's separate proposed emergency supplement funding for the global war on terrorism.

In South and Central Asia, there's a 6 per cent increase highly concentrated in states like Afghanistan and Pakistan which are of critical importance to US national security and are also among the very poorest nations in that region, Tobias said.

Afghanistan's share is $1.067 billion, up from $968 million, and largely focused on programmes that are dealing with poppy eradication, the building of alternative livelihoods, the kinds of things that will build capacity in the ministries and the units of both federal and local government.

Pakistan gets 785 million, up from 707 million. And again, that's focused on a variety of activities that will bring about police training, develop education programmes and health programmes and so forth, Tobias said.

About 51 per cent of the State Department and USAID's resources now are concentrated in rebuilding and developing activities, Tobias said. The fiscal year 2008 budget request includes a 20 per cent increase in resources for "low and lower middle income countries."

Brad Higgins, assistant secretary of state for resource management and chief financial officer for the State Department, said an additional $10.14 billion is being requested for State Department foreign operations such as security, services and maintenance of its more than 260 diplomatic missions around the world.