India allots over ₹7,000 cr as foreign aid, commits ₹100 cr to Chabahar port
The lion’s share of the grants and loans for foreign countries—almost ₹3,005 crore—will go to Bhutan. This amount includes a grant of ₹2,124 crore, according to budget documents
India on Monday unveiled an outlay of more than ₹7,000 crore as foreign assistance in the budget for 2021-22, primarily for countries in the neighbourhood, and allocated ₹100 crore for Iran’s Chabahar port in a signal of its continuing commitment to the strategic project.
The allocation for the external affairs ministry for fiscal 2021-22 was ₹18,154.73 crore, 21 % higher than the revised estimates of ₹15,000 cr for 2020-21. It is also highest allocation for the ministry till date.
The lion’s share of the grants and loans for foreign countries—almost ₹3,005 crore—will go to Bhutan. This amount includes a grant of ₹2,124 crore, according to budget documents.
Development partnership continued to be a focus the ministry’s budgetary allocation, accounting for 42% of the total outlay. The lion’s share of the grants and loans for foreign countries – almost ₹3,005 crore – will go to Bhutan. This includes a grant of ₹2,124 crore, according to budget documents.
Other major beneficiaries in the neighbourhood are Nepal ( ₹992 crore), Mauritius ( ₹900 crore), Myanmar ( ₹400 crore) and Afghanistan ( ₹350 crore), the documents showed.
The loans and grants for foreign countries also included outlays for Seychelles ( ₹160 crore), Bangladesh ( ₹200 crore), Sri Lanka ( ₹200 crore), the Maldives ( ₹250 crore), Mongolia ( ₹2 crore), African countries ( ₹300 crore), Eurasian countries ( ₹100 crore), Latin American states ( ₹40 crore) and other developing countries ( ₹130 crore).
An amount of ₹100 crore was allocated as a grant for developing Iran’s Chabahar port, the same as the allocation during 2020-21. An Indian state-run entity currently operates one of the terminals at the port, which India sees as crucial for its plans to enhance access to land-locked Afghanistan and markets in Central Asian states.
In contrast, there was no allocation as a grant or loan for Chabahar port during fiscal 2019-20.
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The loans and grants for foreign countries also included outlays for Seychelles ( ₹160 crore), Bangladesh ( ₹200 crore), Sri Lanka ( ₹200 crore), the Maldives ( ₹250 crore), Mongolia ( ₹2 crore), African countries ( ₹300 crore), Eurasian countries ( ₹100 crore), Latin American states ( ₹40 crore) and other developing countries ( ₹130 crore).
Though the grant allocated for the Chabahar project was only ₹100 crore, the Indian firm currently operating Shahid Beheshti terminal at the port has stepped up its efforts to enhance cargo handling. On January 17, India delivered two mobile harbour cranes worth more than $8 million and more heavy equipment is set to be delivered to the port in the coming weeks.
India has also pushed for waivers to US sanctions on Iran for the port in view of its strategic importance in transporting cargo and humanitarian aid to Afghanistan.
The external affairs ministry’s total grants and loans for foreign countries in the budget for 2021-22 — ₹7.635 crore —was more than the revised estimates of ₹5,756 crore for fiscal 2020-21.
Over the past year, India stepped up aid and concessional loans for countries in its immediate neighbourhood to help them cope with the economic and health impacts of the Covid-19 pandemic. Among the beneficiaries were the Maldives, which received a soft loan of $250 million as budgetary support last September, and Sri Lanka, which was provided a $400 million currency swap facility last year to ensure financial stability.
A significant share of the aid portfolio in budget 2021-22 will cater for India’s sustained Covid-19-related aid to friendly countries, including the grant of vaccines under the “Vaccine Maitri” initiative.
Given India’s membership of the UN Security Council during 2021-22 and the commitment to multilateral cooperation, an allocation of ₹400 crore has been made for the United Nations. The allocation for Indian missions too was made commensurate with the expanding diplomatic footprint through the opening of new missions.
