Politics and the United States Aid Regime (Essay Sample)

Politics and the United States Aid Regime:
Depoliticizing Economic Assistance to India
Currently, India is the 5th largest recipient of United States foreign aid, receiving $144 million in 1998. Although Japan is India's largest bilateral donor, the United States is still an important source of economic assistance (Heitzman, James and Robert L. Worden, "India"). The U.S. has sponsored many programs in India both to enhance humanitarian and environmental conditions and to further development. However, although the U.S. has provided critical aid to India, the U.S. should remove domestic and international political considerations from its aid decision-making process to make its economic assistance even more effective.
Currently, India has around 433 million people living on less than $1 a day making it the country with the highest concentration of poverty in the world (World Bank, "Overview: The World Bank in India"). India has a per capita gross national product (GNP) of $440, which is less than 1/69th the per capita GNP of the United States (World Bank). Illiteracy is widespread with over 30% of adult males and over 50% of adult females affected. This extreme poverty has severe repercussions on India's development potential. According to World Bank estimates, malnutrition alone "costs India at least US$10 billion annually in terms of lost productivity, illness, and death and seriously obstructs improvements in human development" (World Bank). Clearly, there is great potential for aid programs to help India redress these social problems and move further along its development path.
United States economic assistance to India began in 1951, just 4 years after India attained independence in 1947 (USAID, "USAID/India"). Since that time, India has received a total of $13 billion in U.S. aid (USAID). This aid has consisted of food aid, grants and loans. Some of the major projects of past aid have focused on increasing India's agricultural efficiency and output, improving education, particularly at the post-secondary school level, and improving India's critical infrastructure by constructing power plants and improving sanitation. While these projects have met with some success, future U.S. aid is very much needed to continue addressing these problems and many others still facing India today.
Levels of U.S. economic assistance to India have fluctuated over the years based on various political factors. In the 1970s, the U.S. ended all economic aid to India other than food aid in response to the war with Pakistan (USAID). More recently, in 1998, the United States imposed sanctions on both India and Pakistan in response to their conducting a series of nuclear tests (CNN, "U.S. imposes sanctions on India"). As a result of these sanctions, U.S. economic assistance to India was limited to humanitarian aid, and financial sector reform and agribusiness development activities were terminated (USAID). These sanctions remained in place until September of last year, when the U.S. lifted them in response to India and Pakistan's commitments to aid the U.S. War on Terrorism (CNN, "India, Pakistan hail lifting of U.S. sanctions").
Currently, U.S. aid to India has five main objectives: "enhancing child survival; stabilizing population growth; preventing the spread of infectious diseases, particularly HIV/AIDS; improving the status of women; and protecting the environment" (USAID). The U.S. is currently sponsoring various projects and programs in India to achieve these objectives. However, while these objectives address important problems in India, it is important to note that they were also chosen because of their ability to enhance U.S. foreign policy interests in some way.
The primary U.S. government agency responsible for providing economic assistance, the United States Agency for International Development (USAID), has the "twofold purpose of furthering America's foreign policy interests in expanding democracy and free markets while improving the lives of the citizens of the developing world" (USAID "This is USAID"). Thus, of primary concern in establishing any foreign aid program is ensuring that it also furthers U.S. foreign policy objectives. By giving the aid regime this additional requirement, the U.S. is constraining its economic assistance from addressing India's most pressing social and development needs unless these needs can be shown to have some relation to our foreign policy goals. In this way, U.S. foreign assistance programs may not be implemented in such a way as to optimize the available aid. Instead, some of that money may be frittered away on inefficient programs seen as enhancing our foreign policy objectives in some way. The large emphasis on food aid is an example of this problem. Despite its proven drawbacks as a source of aid, food aid remains popular largely because of...