Introduction
Most developed countries are opting to stop the aid they give to various developing countries. This is due to the fact that countries which were once colonies of various nations from the west are now economically stable. Many of the countries which depended on foreign aid for their development are now able to individually fund their projects.
Consequently, many developed nations have opted to reduce or even permanently eliminate the foreign aid. Britain is one of the countries that have announced its intention to stop its foreign aid to India by 2015. However, contrary to the expectations of many that India would get disturbed over that move, the reverse has been actually the case.
Reasons for Aid Withdrawal
It has been realized that developed countries which were once economically stable are now facing financial crises. On the same note, the donor countries have gone back to the drawing board to determine if actually the aid is as important as deemed, and if the aid achieves its expectations. Given the economic problems that are facing many developed nations, their economies need money to spend.
In this regard, these nations have to choose between giving aid to foreign nations and solving their own internal problems (Mandhana par 3). Therefore, emerging markets have found themselves on the receiving end when any decision to reduce aid is taken. On the same note, though India used to be among poor countries, it has now turned to be among the world’s economic power destinations with the ability to donate money to other low income countries.
India’s Take on the Matter
For a country that has been receiving aid since its independency, the information was expected to come as a rude shock. On the contrary, this information was not received by India as negatively as it would have been for developing countries due to several factors. To begin with, the amount of money that Britain has been injecting into India’s economy to fund various projects, is very little compared to the amount that India injects into the same projects.
On the same note, despite the economic difficulties that are facing almost every country in the world, India’s economy has been growing at an impressive rate for a relatively long period of time. As a result, India has been able to elevate its status to a lower middle income country (Mandhana par 7). Similarly, India can afford to donate to other countries for example, the Philippines, implying that India is not that poor. As put by the then Prime Minister, India does not depend on the foreign aid for its economic development (Mandhana par 8).
Repercussions of the Aid Withdrawal
Though India did not seem concerned about the announcement that the foreign aid will be withdrawn, there are economic repercussions of the decision by Britain. Firstly, though India’s economic growth is impressive, there are still a lot of people living below the poverty line (Mandhana par 15). These people highly depend on the aid from foreign countries for their basic needs. Secondly, Britain’s aid has highly influenced the health sector and its withdrawal will have significant implications.
Conclusion
The article brings into the forefront issues that are emerging between former colonies and their masters. Countries that were once dependent on foreign aid have now turned into economic giants and can no longer be considered as being underdeveloped. On the same note, it highlights the trends that are most likely to be taken by most developed nations, the United States of America being one of them. Developing nations should therefore take caution not to be too dependent on foreign aid because no one can tell what is in store.
Works Cited
Mandhana, Niharika. “A Global Shift in Foreign Aid, Starting in India.” New York Times. 2012. Web.