European Union To Slash Development Aid To India

London, Dec 8: European Union has decided to slash development aid to India with effect from 2014, as part of its efforts to focus on extending help to the poorer nations.The proposed move is part
european union to slash development aid to india...
India TV News Desk December 08, 2011 22:32 IST

London, Dec 8: European Union has decided to slash development aid to India with effect from 2014, as part of its efforts to focus on extending help to the poorer nations.

The proposed move is part of an exercise, under which the 27-nation bloc of European region would lower its aid for a total of 19 developing countries that also includes China.

The decision comes at a time when Europe is battling one of the worst financial turmoils, primarily due to a worsening debt crisis in various European countries.

Among other countries, the development aid would be slashed for India and Indonesia, which have been described by European Union (EU) as “two large middle income countries whose GDP is larger than one per cent of global GDP”.

While the EU has not specified the the existing aid or the quantum of the planned cut, the reports suggest that India is to receive 365 million euros (over Rs 2,500 crore) in the seven years to 2013 from the EU  under the current aid regime.

The EU would also trim its aid to “17 upper middle income countries”, namely Argentina, Malaysia, Brazil, Iran, Maldives, Chile, Mexico, China, Panama, Colombia, Peru, Costa Rica, Thailand, Ecuador Kazakhstan, Uruguay and Venezuela.

Explaining the rationale behind the decision, European Commission said the countries that can generate enough resources to ensure their own development would no longer receive bilateral grant aid.

European Commission is the executive arm of the EU.

Instead, these nations would “benefit from new forms of partnership; they will continue to receive funds through thematic and regional programmes.

“This will be complemented by different innovative cooperation modalities such as the blending of grants and loans.”

 
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