India cuts aid to Maldives and decreases grants to other foreign countries too

: For the upcoming fiscal year, the government has cut its entire budget for aid to foreign nations by 10%: The budget released by the government discloses about the grants cut to other nations too.

Attention India
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As per the Interim Budget paper provided by the government on Thursday, India has suggested reducing funding to the Maldives by 22% for the 2024–25 fiscal year.

The Maldives has received the third-highest amount of government money to other nations, Rs 600 crore, for development assistance. The Maldives received help totaling Rs 770.90 crore in 2023–24, a rise of more than 300 percent over the Rs 183.16 crore awarded in 2022–23. Actually, in Budget 2023, the government had originally set aside Rs 400 crore for the Maldives. Later on, it was changed to Rs 770.90 crore. India has been the Maldives’ main partner in aid and support for the past few years. India provides support to the island nation in areas like infrastructure, education, healthcare, and defence.

But it’s not limited to the Maldives. For the upcoming fiscal year, the government has cut its total aid budget to foreign nations by 10%. India reduced its help to foreign countries budget for 2024–25 from 5426.78 crore to Rs 4883.56 crore. A recent diplomatic spat between India and the Maldives resulted from disparaging remarks made by certain Maldivian ministers regarding Prime Minister Narendra Modi.

The Maldives Lakshadweep Controversy

PM Modi’s visit to Lakshadweep and his sharing of pictures of its immaculate scenery sparked the controversy. This was interpreted in the Maldives, where tourism is the main source of income, as an attempt to promote Lakshadweep as a different tourist destination.

Multiple hotel reservations and airline tickets to the Maldives were cancelled in a rush as a result of the dispute. Complicating matters was the perception that its President, Mohamed Muizzu, was pro-China and anti-Indian.

It’s interesting to note that Finance Minister Nirmala Sitharaman mentioned Lakshadweep during her budget statement on Thursday. In order to increase tourism, Sitharaman stated that Lakshadweep’s infrastructure would receive special attention. “The Union Territory of Lakshadweep will get undivided attention from the government to improve its tourist infrastructure,” Sitharaman said.

Bhutan and Nepal become Top recipients

Bhutan and Nepal would be the top two receivers of government grants, according to the Interim Budget. Nepal has been allotted Rs 700 crore, while Bhutan has been given Rs 2068.56 crore for developmental aid. The allocations from the previous fiscal year have also been reduced for both countries.

The countries of Afghanistan, Bangladesh, Myanmar, and the countries of Latin America have also seen a decrease in their funding for the fiscal year 2024–25. However, budgetary allotments for Mauritius, the Seychelles, African nations, and Sri Lanka have increased. The largest beneficiaries are the developing and African nations, whose allocations have increased by 32% and 11%, respectively. The government gives funding to other countries to support disaster relief efforts as well as cultural and heritage projects.

By: Gursharan Kaur

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