POLITICAL ECONOMY OF INDIAN AID TO THE THIRD WORLD

This article analyzes India’s external assistance as an instrument of statecraft and South–South solidarity. It maps motives—diplomatic influence, market access, technology diffusion, and training—alongside constraints such as fiscal space, foreign-exchange pressures, and bureaucratic capacity. The paper details programmatic modalities, including technical cooperation, scholarships, military training, and project support delivered through specialized institutions. It argues that India’s aid portfolio, while modest in scale, generated outsized reputational dividends in regions where demand for affordable, context-appropriate solutions was high. The analysis highlights trade-aid linkages and the feedback loop between diaspora networks, educational exchanges, and commercial ties.

The body provides a typology of Indian cooperation: turnkey projects in power and industry, small grants for social sectors, and the Indian Technical and Economic Cooperation (ITEC) program’s training pipelines. It evaluates partner selection, conditionalities, and the political signaling embedded in aid announcements. Quantitative snapshots illustrate sectoral and regional allocation patterns, while case studies reconstruct project lifecycles—feasibility, tendering, implementation, and maintenance. The paper also examines risks: cost overruns, spare-parts dependence, and recipient governance. Policy recommendations include clearer evaluation frameworks, co-financing with multilaterals, and aftercare for sustainability. The article concludes that India’s development cooperation functioned as a credibility-building tool, deepening diplomatic reach while nurturing long-term economic partnerships.