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US aid to India drops by 16 per cent in 2013

April 15, 2013 13:04 IST

United States Secretary of State John Kerry has proposed a 16 per cent cut in the American aid to India, reflecting the transition from a traditional "donor-recipient" relationship to a "strategic partnership" between the two countries.

"With respect to India, for the fiscal year 2014, the State Department request is $91 million. This represents a 16 per cent decrease from the fiscal levels 2012 (the previous actual spending)," said a senior State Department official.

This is in continuation of the trend that has emerged over the past few years.

In 2010, the United States aid to India was $126.7 million, which dropped to $121.6 million in 2011 and $108 million in 2012. The proposed aid is $98.3 million in the current fiscal of 2013, which ends on September 30.

"That (drop in US aid to India this year) reflects the ongoing transition we had under way from the more traditional donor-recipient kind of relationship to much more of a strategic partnership," the official said on condition of anonymity as he was not authorised to speak to the press.

"It is a partnership that is addressing India and increasingly global developmental challenges. I think the signature initiative there is the Agency for International Development Millennium Alliance," the official said.

Of the US aid to India, the largest portion -- two/third -- of that is slated for the health sector.

"The biggest programme is in global health. About $61 million is going to the health programme. India still has quite a number of health challenges," the official said.

In 2012, the US aid to India in the health sector was nearly $ 76 million.

Overall, the State Department budget request for FY-2014 was $ 47.8 billion, which is a six per cent cut from the previous FY-2012 of actual spending.

The development assistance from the US to India for the fiscal 2014 has been proposed to be $12 million as against $18.5 million actually spent in 2012.

Pointing to the letter written by Secretary of State John Kerry to the Congress along with his budgetary proposals, in which the top US diplomat emphasises the rebalance towards the Asia Pacific region, the official said India is going to play an important role in this.

The current fiscal ends on September 30, 2013 and the 2014 financial year would begin on October 1.

In terms of the budget for South and Central Asia, Kerry has proposed US$514 million for the fiscal 2014.

But this does not include Afghanistan and Pakistan, which have been budgeted separately by the Obama administration in view of the war against terrorism in the region.

"If you exclude emergency food aid, our total request for the SCA region is three per cent less than the 2012 actual spending. In effect, we are taking less of a cut than the rest of the building, reflecting the strategic importance of SCA region to the State Department," the official said.

Kerry has also requested an increase of US$ 18 million above its FY-2012 levels to promote greater regional co-operation.

"That of course is particularly to support the New Silk Road vision and the economic transition that is taking place in Afghanistan, a goal which we are working very closely with our friends in India," the official added.

Lalit K Jha
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