New Delhi: Presenting the Union Budget 2024-25 Tuesday, Finance Minister Nirmala Sitharaman announced a 48.11 percent cut in development assistance to the Maldives compared to last year, according to revised estimates published by her ministry. However, the government has tripled the development assistance to Sri Lanka.
The cut in aid to Malé comes as ties between the two countries remain tense, following a diplomatic row earlier this year and new Maldivian President Mohamed Muizzu’s tilt towards China.
The 2024-25 budget allocates Rs 400 crore in assistance to Maldives, while the revised estimates from the 2023-24 budget indicates a total expenditure of Rs 770.90 crore.
The amount allocated to the Maldives is even lower than what the government had earlier announced in the February interim budget, by about 33 per cent. In the interim budget, Rs 600 crore was allocated. The 2024-25 allocation for Maldives, however, mirrors the 2023-24 budget estimates.
The country to have gained from cuts to Maldives’ aid is Sri Lanka. According to the 2023-24 revised estimates, the Indian finance ministry had spent Rs 60 crore in aid to Sri Lanka, while in the 2024-25 budget, it has allocated Rs 245 crore — a 308 percent increase.
The amount allocated in the full 2024-25 budget for the island country is higher than what the Modi government allocated in the February interim budget, by around Rs 170 crore. The overall aid to Sri Lanka is even higher than what was estimated in the 2023-24 budget, by 63 percent.
In 2023-24, the Indian government had budgeted Rs 150 crore in development assistance to Sri Lanka.
The allocation of development assistance to countries like Afghanistan, Bangladesh and Myanmar remain the same as estimated in the February interim budget. However, the 2024-25 allocation for total aid to countries is about 9.7 percent lower than the 2023-24 estimates.
However, overall, 2024-25 budget estimates remain the same between the interim budget and the just announced full budget.
Bhutan & Nepal remain India’s largest development aid partners
Bhutan and Nepal retain the top spots for India’s development assistance for 2024-25. New Delhi has allocated a total of Rs 2,068.56 crore for Thimphu, which includes Rs 989.70 crore as loans and Rs 1,078.86 crore as grants.
This is however a 13 percent decrease from the 2023-24 revised estimates allocated to the country — Rs 2,398.97 crore (Rs 784 crore in grants and Rs 1,614.36 crores in loans).
Nepal, however, saw a slight increase in development aid in the 2024-25 budget. The government has allocated Rs 700 crore towards the Himalayan country, a slight increase from the Rs 650 crore allocated in the revised estimates.
Seychelles saw a 303 percent increase in allocation, from Rs 9.91 crore in the 2023-24 revised estimates to Rs 40 crore in the 2024-25 budget. This amount is higher than what was originally allocated in the February interim budget towards the East African country.
(Edited by Gitanjali Das)