Oral statement to Parliament

Andrew Mitchell: our aid programme in India

This speech was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

The Development Secretary reaffirms Britain's support for India's poorest people

In response to recent media reports on aid to India, Secretary of State Andrew Mitchell reaffirmed Britain’s support for India’s poorest people. 

“These comments do not represent the views of the Government of India, who have publicly welcomed our aid.

“As I said at the time we announced the results of the Bilateral Aid Review, the Indian Government has made great progress on tackling poverty but there is a huge need in India.

“We will not be there forever - we have said we are walking the last mile - but now is not the time to end the programme.

“The UK and Indian Governments have agreed a programme which focuses on the poorest states and developing the private sector. It also recognises the Government of India’s own commitment to policies which will help reduce poverty in the long term.”

Since the bilateral aid review, India is no longer the UK’s largest bilateral programme.

Quoted figures for Indian ‘aid’ generally include either trade credits (which do not qualify as Overseas Development Assistance) or programmes of mutual interest with neighbouring countries.

Past comments

Last month, the UK’s aid programme in India became the focus of some media attention following past comments by its Government’s Finance Minister.

International Development Secretary Andrew Mitchell said:

“The remarks being reported from the Government of India are out of date and were made during a parliamentary debate in 2010. We have also investigated claims of corruption and found no British funds were misused.

“Our completely revamped programme is in India’s and Britain’s national interest. It is one part of a much wider relationship between our two countries. India itself has got 60 million children into school in recent years with its own money but more than 30 per cent of the world’s poorest people live there. There are states the size of Britain where half of all children suffer from malnutrition. We will not be in India for ever but now is not the time to end the programme.

“However, we have completely changed our approach in India. We are working in 3 of the poorest states and ensuring that about half of the programme focuses on pro-poor private sector investment - which has the characteristics of a sovereign wealth fund and from which India and the British taxpayer gain.”

An official spokesperson for the Government of India said:

“Relations between India and the UK are warm and friendly and have stood the test of time.

“India appreciates cooperation extended by the UK in a number of areas, which have contributed to India’s overall development efforts, particularly through capacity building, exchange of best practices, knowledge sharing and sharing of technology and technical expertise.

“The bilateral cooperation between India and the UK has been and remains mutually beneficial.”

Mr NK Singh, spokesperson for the Chief Minister in Bihar, a DFID focus state, said:

“We welcome the focus of DFID to States, particularly those which have lagged behind in their development achievements. Bihar, with a population of 110 million, has high poverty density given historical factors and notwithstanding its recent spectacular growth achievements has a long way to go to mitigate poverty and improve its performance on human development indicators.

“The DFID programme will help address these concerns, enable capacity building and innovate development to optimise outcomes. Given the large unmet needs of the state, a sustained programme over several years is necessary.

“The support of DFID has been valuable in improving better utilisation of central funding and complete ongoing initiatives.”

B K Patnaik, Chief Secretary of Orissa, a DFID focus state, said:

“I have seen for myself how DFID support has reached thousands of children, women and men in Odisha.

“I remember being part of the design team for a rural livelihoods project in the state which helped over 70,000 poor people move out of poverty. This programme has influenced the central government’s policy on rural livelihoods as well.

“DFID has provided us solid support across a range of sectors - public sector governance, public finance, power, health, nutrition and education - all of which have helped us to grow and reduce poverty in the state. However, our job is by no means over. We need DFID’s continued support to help us to change the lives of thousands more people for the better.”

Q&A

What is DFID’s reaction to the Indian Finance Minister’s comments saying UK aid is “peanuts”?

The remarks being reported from the Government of India are out of date and were made during a parliamentary debate in 2010. Since then, we have completely changed our approach in India. On 10 February 2012, the Finance Minister of India publicly welcomed the UK aid programme; this followed a similar official statement from the India Foreign Ministry on 7 February, as well as several of our State partners.

Shouldn’t the Indian Government do this themselves?

The Indian Government has made huge progress on tackling poverty, for instance by getting 60 million children into school since 2003. But there is still huge need - a third of the world’s poorest people live in India.

We will not be in India forever - we have said we are walking the last mile - but now is not the time to end the programme.

Did Andrew Mitchell say that aid was given to win the Typhoon contract?

No. As Mr Mitchell has made clear, aid is not tied. Aid is an important part of our wider strategic partnership with India. Our aid is not linked to British companies winning contracts. British aid is untied and will remain so. 

Why should we give aid to a country with a space programme?

There is huge need in India. A third of the world’s poorest people (living on less than 80p a day) live in India - more than in sub-Saharan Africa. In Indian states the size of Britain, more than half of all children are malnourished.

What about corruption such as the allegations made in the media recently about stolen televisions?

These are baseless allegations. The Secretary of State launched an inquiry into this which found no UK funding had been misused.

Isn’t all aid wasted?

The Coalition Government has a zero tolerance policy on corruption. It has set up an independent aid watchdog to monitor how money is spent and details of all spending over £500 is set out on the DFID website for maximum transparency. The International Development Committee - a cross-party committee of MPs - supports the Government’s approach in India.

British aid in India has made a huge difference. We have helped to free India from the scourge of polio. We have helped 1.2 million children go to school in the last ten years. And we have lifted more than 2 million people out of poverty in the poorest states.

Why doesn’t the UK tie aid to trade?

The International Development Act 2002 makes clear that taxpayers’ money must only be spent on the purpose of reducing poverty. To avoid any ambiguity, the Act states that development assistance must be provided for the purpose of furthering sustainable development or improving people’s welfare and be likely to result in the reduction of poverty.

The UK does not provide aid for any other purpose. British aid is untied, and will remain so.

About 80 percent of DFID’s direct contacts for services are awarded to British companies in fully untied competition. Untying aid provides better value for money, gives UK companies a chance to compete equally for opportunities and enables manufacturors in developing countries to compete and grow. British companies do not seem to need tied aid, as they continue to win the majority of our competitively tendered business.

The Coalition Government has vastly strengthened the information available to taxpayers about what their money is achieving in reducing poverty. The results expected from every aid project are now published on our website. And we have set up the Independent Commission on Aid Impact, to ensure that the results of our work are rigorously and independently checked.  

Providing aid for poverty reduction is also strongly in the UK’s national interest. Free trade, fair competition and the strength of British businesses is something the Coalition Government supports and promotes. Helping developing countries prosper and grow is important for our own economic opportunities as a global trading nation; for our security in an increasingly inter-dependent world; and for tackling global issues like climate change which will shape the world in which our children live.

Our work on reducing poverty in developing countries is rightly part of Britain’s overall relationships with those countries rather than an isolated issue. All parts of the Government works in a close and collaborative way and DFID ensures poverty reduction is a core part of Britain’s national agenda overseas.

Examples of our work in India

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Facts and stats

  • DFID has directly helped 1.2 million Indian children to go to school since 2003
  • We have lifted 2.3 million people out of poverty in rural areas in the last five years.
  • DFID’s programmes in India are saving 17,000 lives per year (one life every 30 minutes)
  • DFID support has helped over 550,000 women to give birth safely in a health facility with skilled assistance in the last five years
  • DFID support over the past decade has helped India achieve zero polio transmissions in the last year
  • DFID support helped reach over 1.6 million women with credit, financial and skills development since 2003
  • We helped 400,000 people gain access to improved sanitation in 2009-10 in Madhya Pradesh and West Bengal.