India-Nepal ties
File photo of PM Narendra Modi with Nepal's Prime Minister K.P. Sharma Oli | PTI
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New Delhi: India’s foreign aid to Nepal and the Maldives saw a substantial jump in the Union Budget unveiled by Finance Minister Nirmala Sitharaman Friday, in keeping with the Modi government’s foreign policy focus of ‘Neighbourhood First’.

The foreign aid allocation for Nepal stands at Rs 1,050 crore in the 2019-20 Budget, up nearly 62 per cent over the Rs 650 crore earmarked in 2018-19.

For the Maldives, the allocation was more than doubled to Rs 400 crore, from Rs 125 crore in 2018-19.

African nations, including Mauritius, also received a boost in Indian aid in Sitharaman’s maiden Budget. As compared to Rs 200 crore in 2018-19, the Modi government has set aside Rs 450 crore for schemes and projects being sponsored by India in African countries. Mauritius, the Indian Ocean island off the east African coast, will get Rs 1,100 crore in aid, compared to Rs 350 crore in 2018-19.

Also read: With an eye on China, Modi & Solih inaugurate coastal surveillance system in Maldives

Neighbourhood first

Despite the rise of anti-India sentiments in Nepal during the 2015 Madhesi agitation, New Delhi’s aid to Kathmandu has never faltered. During a meeting between Prime Minister Narendra Modi and his Nepali counterpart K.P. Sharma Oli in May, New Delhi committed to expediting a few pending projects that India is pursuing for infrastructure development in Nepal.

India is engaged in creating a 900-MW hydroelectric project, Arun-III, in Nepal. India and Nepal are also partners in various road connectivity projects under BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation), SAARC (South Asian Association for Regional Cooperation) and BBIN (Bangladesh, Bhutan, India, Nepal Initiative).

Nepal, however, is also part of China’s multi-billion-dollar ‘Belt and Road Initiative’ (BRI), under which there are plans to create a trans-Himalayan rail project.

Male had come under the Chinese embrace under its previous government, but the Ibrahim Mohamed Solih administration sworn in last year has signalled an end to its pro-China stance. However, the Maldives owes China $3 billion for infrastructure projects undertaken by Chinese companies during the tenure of Solih’s predecessor Abdulla Yameen.

During Prime Minister Modi’s visit to Maldives last month, both sides agreed to create and develop infrastructure in the archipelago. India and Maldives have agreed to work towards starting a regular passenger-cum-cargo ferry service between both countries, apart from other projects.

Also read: In 15 years, China’s training courses for Nepal’s civil servants has increased 4,000%


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