Book Description

The test of whether the UK should continue to give aid to India is whether that aid makes a distinctive contribution to poverty reduction. The Government of India has primary responsibility for this and has already reduced poverty levels from 60 percent in 1981 to 42 percent in 2005. But whilst the economy is growing there are large pockets of poverty that still remain. The DFID plans to change some of its programme, focusing primarily on three of the poorest states, Bihar, Madhya Pradesh and Orissa, also changing the sectors it prioritises and putting 50 percent of its budget through the private sector by 2015.The Committee supports the focus on the poorest states but provided it is supported by the Government of India. They recommend supporting in particular sanitation, malnutrition, maternal and child health and social exclusion. The Committee supports the Government's aim to forge a new enhanced partnership with India with its mutual benefits from cooperation in trade and investment but the DFID must ensure UK Government policies help protect the poorest and reduce inequalities. The Committee assuming that over the next four years as India continues to grow at current rates it will have increased its capacity to tackle poverty and meet the millennium development goals. DFID should continue to provide technical assistance where requested but the funding mechanism should change by 2015.