USAID move to halt new funds could impact initiatives in India

USAID move to halt new funds could impact initiatives in India

USAID move to halt new funds could impact initiatives in India ByHT Correspondent Jan 27, 2025 12:07 AM IST Share Via Copy Link US President Donald Trump issued the executive order on ‘Re-evaluating and Realigning United States Foreign Aid’ on January 20.

New Delhi The US Agency for International Development (USAID) has paused new funding for programmes across the world following the Trump administration’s decision to halt all foreign aid, barring that to Egypt and Israel, a move that will impact some initiatives in India.

US President Donald Trump issued the executive order on ‘Re-evaluating and Realigning United States Foreign Aid’ on January 20. (AFP)

However, people familiar with the matter said on condition of anonymity that the overall US assistance for India, including by USAID and other organisations, had declined to a few hundred million dollars over the past decade, especially after the Indian government’s move in 2004 to not accept foreign aid that came with conditions.

The people said it was too early to assess the impact of the US administration’s decision on India. The US embassy too is making its own assessment, with a spokesperson saying: “We are carrying out a review to ensure that our existing grants comply with executive orders.”

After US President Donald Trump issued the executive order on “Re-evaluating and Realigning United States Foreign Aid” on January 20, American media reports said secretary of state Marco Rubio sent out a memo on how the state department, USAID and other agencies should execute the executive order stopping foreign aid during a 90-day reassessment period.

USAID, which is active in India in areas such as health, education, climate resilience, clean energy, education, water, sanitation and hygiene, issued a notice to its officials and implementing partners across the world that said the agency is “pausing all new obligations of funding” pending a review of foreign assistance programmes.

“Contracting and Agreement Officers shall immediately issue stop-work orders, amend, or suspend existing awards, consistent with the terms and conditions of the relevant award,” the notice said. Decisions on continuing, modifying or terminating programmes will be made after the review, it said. Among the waivers approved by the secretary of state are emergency food assistance.

The people cited above, however, noted that total US assistance for India in recent years has hovered around the $150-million-mark and said the Trump administration’s decision is unlikely to have a major impact on the country. “Besides, some of the US outlay goes on administrative expenses,” one person said.

According to the US government’s ForeignAssistance.gov portal, the actual disbursements for India by various American departments and agencies declined from $201.88 million in fiscal 2023 to $159.6 million in fiscal 2024. The main agencies involved in providing aid to India during this period were USAID, department of agriculture, department of energy, department of state and Federal Trade Commission.

According to the portal, the main sectors for assistance in 2024 were basic health ($42.9 million), maternal and child health ($20.9 million), environment protection ($17.14 million), HIV/AIDS ($11.3 million) and energy ($10.1 million), while operating expenses accounted for $18.46 million.

“India will be able to tide over any cuts in US aid. We have stopped accepting aid that comes with too many conditions, though there has been cooperation with the US in some sectors because of the robust growth in the overall relationship,” a second person said.

“The impact of the new executive order could be greater in regions such as Africa, where the allocation is much greater,” he added.