According to reports this foreign aid allocated for the different countries will largely be spent towards implementation of a variety of initiatives ranging from large infrastructure projects such as hydroelectric plants, power transmission lines, housing, roads, bridges, integrated check-posts, to small-scale grass-roots level community development projects as well as training and capacity building programmes.
The Union Budget 2025-2026 was presented at the Parliament on Saturday where the Ministry of External Affairs (MEA) was allocated a total of Rs 20,516 crore and in line with India's 'neighbourhood first' policy, Bhutan was allocated the largest share of Rs 2,150 crore. Notably, the fiscal aid for Maldives saw a sharp increase this year compared to last, despite ongoing tensions with Muizzu government.
The Ministry of External Affairs (MEA) was allocated a total of Rs 20,516 crore as against the current fiscal's budget estimate of Rs 22,154 crore and revised estimate of Rs 25,277 crore.
According to reports this foreign aid allocated for the different countries will largely be spent towards implementation of a variety of initiatives ranging from large infrastructure projects such as hydroelectric plants, power transmission lines, housing, roads, bridges, integrated check-posts, to small-scale grass-roots level community development projects as well as training and capacity building programmes.
The total overseas development partnership portfolio for 2025-26 has been pegged at Rs 6,750 crore, which is nearly 33 per cent of the allocation made to the MEA.
The outlay for overseas development assistance is an increase of about 20 per cent over current fiscal's allocation of Rs 5,667 crore.
Interestingly, out of the total allocation under the overseas development partnership portfolio, Rs 4,320 crore (64 per cent) has been earmarked for immediate neighbours.
Bhutan - According to revised estimates for 2024-25, Bhutan was allocated an amount of Rs 2543 crore but this time, with the largest share of development aid, the Union Budget 2025-2026 allocated Rs 2,150 crore.
Maldives - Interestingly, India has increased foreign aid for Maldives this year from Rs 400 crore to Rs 600 crore, months after the new President, Mohammed Muizu's government saw tensions with India briefly since his win and his notably pro-China stance.
Afghanistan - In continuation with India's special relationship with the people of Afghanistan, an allocation of Rs 100 crore has been made to that country. The allocation to Afghanistan at the budget estimate stage for 2024-25 was Rs 200 crore. But revised estimates put the figure at Rs 50 crore.
Myanmar - Myanmar's allocation rose from Rs 250 crore in the 2024-25 budget to Rs 350 crore for 2025-26, reflecting the ongoing turmoil in the country. Ethnic armed groups have seized large areas, including regions along India's northeastern borders.
Nepal - The government alotted Rs 700 crore to Nepal this year.
Bangladesh - For the next fiscal, the allocation for Bangladesh has been pegged at Rs 120 crore.
Sri Lanka - The government alotted Rs 300 crore to Sri Lanka this year.
Mauritius - The government alotted Rs 500 crore to Mauritius this year.
Iran - Like for 2024-25, an amount of Rs 100 crore has been set aside for the Chabahar port project. Located in the Sistan-Balochistan province on the energy-rich Iran's southern coast, the Chabahar port is being developed by India and Iran to boost connectivity and trade ties.
The total assistance for Latin America and Eurasia in the budget for 2025-26 was pegged at Rs 100 crore.