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Development cooperation: White paper needed on this grey area

There must be a professional independent agency to oversee all our development and aid activities abroad

editorials Updated: Aug 07, 2015 03:47 IST

From relatively modest beginnings, India has become a significant player in the area of global development cooperation. The issue has also become an important aspect of Indian foreign policy and strategic thinking. The institutional architecture to implement development projects abroad, however, is still evolving.

Unlike other donors, we do not have a separate development agency to design, coordinate and implement our aid projects and activities. As a significant amount of taxpayers’ money is involved, the time has come to openly discuss our aims, strategies and aid figures, so that these projects can be evaluated professionally.

Traditionally, India has been a recipient of foreign aid. In the last few years, however, India has provided more development assistance than it received. It has been estimated that India provides assistance worth $1.5-2 billion every year.

Our major activities include: Lines of Credit (LoC), capacity-building training programmes and bilateral grant assistance projects. Till March 2015, the EXIM Bank had signed 194 LoCs, covering 63 countries with credit commitments of about $11.7 billion. More than 60% of this credit was for African countries.

Under the Indian Technical and Economic Cooperation programme, about 10,000 (8,500 civilian and 1,500 defence) personnel from over 160 countries are trained in India every year. Traditionally, grant assistance projects are concentrated in the neighbourhood — Bhutan, Nepal, Sri Lanka, Myanmar and Afghanistan.

So far, aid projects have been managed by departments in the ministry of external affairs (MEA), ministry of finance and EXIM Bank. Although in 2007, the then finance minister mentioned establishing a new India International Development Cooperation Agency, it did not happen.

Since 2012, Development Partnership Administration (DPA), a new MEA division, coordinates these activities. It is becoming clear that development outflows would increase in the coming years. Still, we have not clearly declared our objectives and strategy concerning development cooperation. Indian policymakers have argued time and again that our activities are ‘different’ and part of South-South Cooperation. They are non-conditional and demand-driven. Unlike China, India has not even issued any white paper on its activities abroad.

Since its objectives, strategy and relevant facts are not made available, it is difficult to evaluate Indian aid projects. Despite the weaknesses, these activities have helped India strengthen its political and economic ties with partner nations, and remain popular and cost-effective.

Every country coordinates its aid activities with its foreign ministry. Still, the implementation of overseas aid is done by specialised agencies such as the US Agency for International Development, Department for International Development (UK) and Japan International Cooperation Agency. India too needs a professional independent agency for such projects. To begin with, the DPA must prepare a white paper on our development activities abroad so that an informed debate can be initiated.