New Delhi: In the Union Budget 2024-25, Finance Minister Nirmala Sitharaman announced substantial changes to Indias foreign aid allocations, reflecting strategic shifts in the neighbourhood first policy. The most notable adjustments include a significant reduction in aid to the Maldives and a substantial allocation to Bhutan.Bhutan tops aid list, Maldives sees major cutBhutan emerged as the top recipient of Indias development aid, with an allocation of Rs 2,068 crore. This increase underscores the strengthening of bilateral relations. In stark contrast, the Maldives witnessed a drastic reduction, receiving only Rs 400 crore compared to the previous Rs 770 crore. The interim budget had already proposed a 22% cut, but the final budget slashed aid further by 48%. This cut comes amidst strained relations following the election of Mohamed Muizzu, known for his pro-China stance. His administrations critical remarks about Indian Prime Minister Narendra Modi sparked public outrage and a Boycott Maldives campaign, affecting tourism.Aid to other neighboursNepal secured the second-highest aid amounting to Rs 700 crore, reinforcing Indias commitment to its northern neighbour. Sri Lanka saw a significant increase in aid, receiving Rs 245 crore compared to last years Rs 60 crore. This increase aligns with Indias efforts to support Sri Lanka amidst its economic challenges.Allocations beyond immediate neighboursThe budget also included allocations for countries beyond South Asia. Irans Chabahar Port received Rs 100 crore, highlighting its strategic importance. Afghanistans aid was slightly reduced to Rs 200 crore from Rs 220 crore. Bangladesh was allocated Rs 120 crore, while Myanmars aid was reduced to Rs 250 crore from Rs 320 crore. African nations collectively received Rs 200 crore, and Mauritius was allocated Rs 370 crore.Whats in the overall foreign affairs budgetThe total budget for the Ministry of External Affairs was reduced to Rs 22,154 crore for 2024-25, down from Rs 29,121 crore. This aligns with the interim budget allocation in February, indicating a strategic realignment of Indias foreign policy expenditures.The Union Budget 2024-25 reflects Indias dynamic foreign policy, with significant adjustments in aid allocations to its neighbours and strategic partners. The substantial cut in aid to the Maldives amidst strained relations and the increased support to Bhutan and other neighbours underscore Indias evolving diplomatic priorities.
