Britain ending financial aid to emerging power India

Fri Nov 9, 2012 11:30pm IST

British Prime Minister David Cameron (L) and his Indian counterpart Manmohan Singh walk before their meeting in New Delhi July 29, 2010. REUTERS/B Mathur/Files

British Prime Minister David Cameron (L) and his Indian counterpart Manmohan Singh walk before their meeting in New Delhi July 29, 2010.

Credit: Reuters/B Mathur/Files

Related Topics

REUTERS - Britain will stop giving financial aid to India by 2015, the government said on Friday, marking a shift in ties between the one-time imperial power and its fast-growing former colony.

The move follows anger at handouts to an economy which is Asia's third largest and has a space program, at a time of spending cuts and economic gloom in the United Kingdom.

"It's time to recognise India's changing place in the world," International Development Secretary Justine Greening said in a statement that estimated savings of GBP 200 million by 2015.

Existing programs will be completed by that date and Britain will make no new cash commitments.

India became independent from British rule in 1947. It is now the third largest investor in Britain and its companies own flagship brands including Jaguar Land Rover.

Despite India's rapid economic development over the past decade it suffers deep pockets of severe malnutrition and extreme poverty.

The move is unlikely to anger the Indian government, whose former finance minister described Britain's aid contribution to India as a 'peanut.' In 2011, Prime Minister Manmohan Singh announced a $5 billion aid credit line for Africa.

Controversy over the aid program flared after former International Development Secretary Andrew Mitchell said last year the GBP 280 million annual assistance was partly about "seeking to sell the Typhoon."

India later entered into exclusive negotiations with France's Rafale fighter, rejecting the British-backed plane for an estimated $15 billion contract.

(Reporting By Frank Jack Daniel; Editing by Toby Chopra)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

Pricing Controls

REUTERS SHOWCASE

India-China Relations

India-China Relations

India says to defend China border after standoff ahead of Xi visit.  Full Article 

Importing Iron Ore

Importing Iron Ore

As mining curbs bite, India offers market to glut-hit iron ore.  Full Article 

Lower Output

Lower Output

IOC cuts refinery output as rains hit fuel demand - source.  Full Article 

Drug Approval

Drug Approval

Epirus, Ranbaxy win India approval for arthritis drug copy.  Full Article 

Farming and Technology

Farming and Technology

Climate smart farmers get tech savvy to save India's bread basket.  Full Article 

Rajan Speaks

Rajan Speaks

RBI chief Rajan says limiting reliance on foreign debt.  Full Article 

India-Vietnam Ties

India-Vietnam Ties

India tightens Vietnam defence, oil ties ahead of China Xi's visit.  Full Article 

Debt & Equity Deal

Debt & Equity Deal

KKR to lend $175 million to GMR Infrastructure - source.  Full Article 

Preparing for IPO

Preparing for IPO

Alibaba boosts IPO as demand strengthens.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage