India’s transformation from being a recipient to a donor of international development assistance is the key to attaining a leadership role in the global economy, said Shashi Tharoor, chairperson of the Parliamentary Standing Committee on External Affairs.
He was speaking at the release of a report on the ‘Future of India’s Development Policy Cooperation,’ jointly prepared by the Institute of Sustainable Development and Governance (ISDG), Thiruvananthapuram, and Oxfam India.
According to the report, India, which has been a recipient of development aid since Independence, has been recently making its mark as a donor in the international aid regime. For instance, in the past six years, India allocated almost $7 billion for assisting other countries. The volume of India’s development cooperation has grown four-fold during 2003-04 to 2013-14, buoyed by the high GDP growth rates. Today, India is only second to China in assistance to the global South.
Major beneficiaries
The facets of India’s development cooperation include providing grants and Lines of Credit (LoC) and capacity building through the Indian Technical and Economic Cooperation (ITEC) programme.
While major beneficiaries of the programme have been South Asian countries such as Bhutan, Afghanistan, and Nepal, the largest share of the total LoC has been provided to African countries.
The report suggests that in the light of the lingering recessionary conditions in the North and the growing significance of BRICS (Brazil, Russia, India, China and South Africa) in the global economy, South-South development cooperation is expected to play a significant role in the international aid regime. For India, this presents an opportune moment to make use of development cooperation as a strategic foreign policy tool in order to boost its economic power.
Recommendations
In order to do so, the report recommends the establishment of an India International Development Agency (INIDA) and of a South-led Alternative to the Development Assistance Committee (DAC) of the OECD (Organisation for Economic Cooperation and Development).
Mr. Tharoor welcomed the findings of the report and agreed that it was advisable to set up an Indian development agency in order to professionalise aid donation and reduce the role of diplomats in the process.
However, he advocated caution in the matter of forming a South-South collective, given that India’s interests may conflict with that of its closest neighbours in the South. He said that India’s assistance model, with its helpful, non-intrusive and sustainable nature, would help it achieve the status of a benevolent economic power.
