AGI Top 12 in 2012: An Overdue India Policy Shift for the UK

AGI recaps the highlights of 2012, which we think made an impact and will continue to drive change in the coming years. These highlights and events are picked by AGI editorial team from fields of business, politics and culture across Asia.

With the announcement by UK International Development Secretary Justine Greening in November that the UK will halt all state financial aid to India by 2015, it has become abundantly clear that the relationship between the two countries is in the early stages of a seismic shift.

Future interaction with India is, Greening has stated, to focus on trade and technical cooperation, with a group of British development experts working in partnership with the Delhi government and private sector investment to assist in poorer areas of the country. Given the context of OECD forecasts suggesting that India will eclipse the Euro Zone as an economic unit within twenty years, this withdrawal of aid seems, in many ways, overdue.

In any case, the amount of capital donated has, in recent years, proven largely insignificant,amounting to less than 0.03% of India’s national income. Criticism to the effect that aid has long been intended primarily as a political tool to invoke gratitude toward benefactors in the British government has, therefore, been increasingly rife. It is not the end of aid to India itself, then, which is to be considered impactful,but rather the emerging geopolitical realities which have prompted the shift. The move demonstrates an unambiguous recognition of India’s changing place in the world, and an end to a paternalistic relationships rooted firmly in the colonial past. For today’s India, a booming economic powerhouse with its own space programme,such one sided displays of soft power appear increasingly patronising.

This revaluation accepts the two players as equal partners, and recognises that India has well and truly arrived as a power player on the international stage. For India, in the words of external affairs minister Salman Kurshid responding to the announcement, ‘aid is past, trade is future’.

by Sam Jones

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