India increases aid to Maldives. What about Bangladesh, Sri Lanka?

The Union Budget can give you a glance into Indian diplomacy. Who is New Delhi favouring? With which countries are ties tense?

The Union Budget 2025 hints at a thaw in ties with the Maldives. The island nation is among the top three benefactors of development aid among India’s allies. This comes after ties between New Delhi and Male strained last year, leading to a cut in allocation last year.

Which countries will benefit from Finance Minister Nirmala Sitharaman’s Budget ? Who will get what? We take a look.

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Bhutan

Bhutan is at the top of the list of nations receiving aid from India. With Rs 2,150 crore, it has the largest allocation of developmental grants. However, this is a decline from the revised allocation of Rs 2,543 crore last year.

The funding for the Himalayan kingdom is aimed at infrastructure development, hydropower projects and economic cooperation.

Maldives

Ties between India and the Maldives are on the mend. The Union Budget is proof. India’s allocation for the island nation has increased from Rs 470 crore to Rs 600 crore, which is an increase of 21.6 per cent.

In 2024, India had slashed aid significantly by 48 per cent compared to Rs 770 crore given in 2023. The move last year came after ties between the two nations deteriorated following President Mohamed Muizzu’s pro-China stance . In January last year, a few Maldivian MPs mocked PM Narendra Modi’s visit to Lakshadweep , worsening the matter.

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Last year, India withdrew its military personnel from the Maldives but now efforts are being made to restore the relationship. External Affairs Minister S Jaishankar visited Maldives in August, Muizzu visited India in October and the Maldivian Defence Minister Ghassan Maumoon visited India earlier this month.

Afghanistan

The aid to Afghanistan has increased by 50 per cent. This Budget proposes an allocation of Rs 100 crore. In 2024, Rs 50 crore was allocated to the nation now under Taliban rule. Overall, there has been a decline from the Rs 207 crore allotted two years ago.

Foreign Secretary Vikram Misri met Taliban officials in Dubai last month, marking the highest outreach with Kabul since the Taliban takeover. However, India does not recognise the Taliban government.

Bangladesh

India’s ties with Bangladesh have taken a hit since the ouster of Sheikh Hasina in August 2024. However, there is no change in the aid allocated to the neighbouring nation. With Rs 120 core, the outlay remains unchanged.

Myanmar

There is a 12 per cent drop in the grant set aside for Myanmar. The proposed sum this time is Rs 350 crore, while in 2024, the country was assigned Rs 400 crore.

Civil war rages on in Myanmar, where ethnic armed groups have taken control of various territories including areas bordering northeast India. The Indian government in December has tightened rules for the movement of people on both sides of the India and Myanmar border.

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Sri Lanka

There has been no change in the aid for Sri Lanka. Union Budget 2025 allocates Rs 300 crore like the previous one.

The neighbouring nation faced its worst economic crisis in 2019 and is now recovering.

Nepal

Nepal receives the second-highest aid from India. Union Budget 2025 proposes Rs 700 crore to the Himalayan neighbour. This is the same amount as the previous year.

Other nations

There has been a 13 per cent reduction in the grant to Mauritius from Rs 576 crore in 2024 to Rs 500 crore in this Budget. Seychelles, which was allocated Rs 37 crore last year will now get Rs 19 crore, which is a sharp 49 per cent decline.

Aid to African Nations has gone up to Rs 225 crore in Union Budget 2025 from Rs 200 crore set aside in Union Budget 2024. The African Union joined the G20, which India is part of, in 2023 when New Delhi hosted the summit. The bloc was officially represented at the gathering in Brazil last year.

With inputs from agencies