Fuming Brits call for stopping aid, after India dumps Eurofighter

Fuming Brits call for stopping aid, after India dumps Eurofighter

Last year, British prime minister David Cameron led one of the largest-ever business delegations to India, comprising six cabinet ministers and around 60 business leaders.

He lobbied heavily in favour of the British built Eurofighter. But, as France emerges as the firm front runner to supply India with 126 fighter jets, the knives are now out in Britain --for Cameron and for India too.

The loss of the defence contract to the French company Dassault, which makes the Rafale fighter, would deny Eurofighter’s Typhoon an important export order that could in turn jeopardise thousands of British jobs. Many in Britain have accused the Cameron-led government of not properly supporting British industry in the past and therefore regard the probable loss of the Eurofighter deal as emblematic of its general inadequacy.

As a backlash over India’s decision, however, sections of the public and various commentators have taken it upon themselves to also apportion blame to India by linking the loss of the contract to the issue of aid. They have been quick to point out that the British government is sending 280 million pounds to India for each of the next four years and that the aid package is around 15 times larger than what France sent to India in 2009.

They ask, “Where is the trade dividend?” – especially in light of international development secretary Andrew Mitchell saying last year that the aid relationship with India is very important and the focus of the relationship was also about seeking to sell Typhoon jets. For him, aid was linked to trade. But this is a stance which is now being strenuously denied by various members of the government he is part of in order to dampen criticism in view of the French having possibly bagged the prize.
Vociferous protests have subsequently taken place concerning sending aid to India, especially at a time when massive public sector job losses and slashes to services are being made in Britain.

It is being asked why should the overburdened British taxpayer give aid to a country with 300 billion dollars worth of foreign reserves and year on year growth that has been over 8.5 per cent? It has also not gone unnoticed that India has funds not just for its own aid and space programmes, but for nuclear weapons too, while Britain itself has no space programme and has been debating scaling down its own nuclear weapons systems.

Many in Britain question why aid should be given to India, which has an economy that is on course to overtake Britain’s in the next ten years, and that, according to financial advisers Merrill Lynch, has 1,53,000 dollar-millionaires - a number that grew by 20 per cent in just one year, compared with Britain’s own increase of less than one per cent. 

Redirect funds

They argue that India might do better to scrap its space programme, aircraft carriers, nuclear weapons and its huge aircraft buying programme worth billions and redirect all those funds to invest in improving the plight of the poor. Britain could then drop its aid and save money.

Banner headlines in the British press have claimed that giving money to India is a waste anyhow, given that rich Indians and politicians have silted away billions in Swiss bank accounts since independence. The accusation is that much aid money to India is thus chewed up by corruption and fraud. The lavish spending of India’s rich has been targeted too, with much focus on multi storey Mumbai penthouses, Formula 1 and the like.

Such arguments aside, though, what has often been ignored during this tirade against India is that, as a strategy for poverty alleviation and within the broader context, the impact of aid is minimal at best. There is no denying that, despite India's rising power on the world stage, poverty remains rife and the country is home to a third of the world’s malnourished children. India's annual average income per person is around 2.5 per cent of Britain’s.

However, much of the hardships are today fuelled by rising inequality brought about by neo-liberal economic policies. Inequality in India has increased significantly since it opened up its economy in the early 1990s. India's rich elites have benefited enormously, and this has often been at the expense of the poor. Look no further than the real estate speculators and the land grabs from the poor, the rising obesity levels and the persistent malnourishment, the corporate rich and the theft of natural resources in the tribal areas and the high GDP and the low poverty alleviation statistics. Aid is like using a plaster to stem a burst dam.

Regardless of whether India actually wants or needs this aid in the first place, it’s a pity that sections of the British media and certain politicians do not highlight the fact that the sum given by Britain to India is anyhow only less than 1 per cent of Britain’s debts - hardly a drain on the British economy. It’s also a pity that they don’t focus more on the real drain placed on the economy via the hundreds of billions that are being picked from the pockets of ordinary Brits via bank bail outs, corporate subsidies and fraud and tax avoidance and evasion by the rich.
Much easier for them to point the finger at India in order to divert attention from the neo-liberalism that continues to fuel Britain’s economic woes and exacerbate poverty in India. Much easier to use aid to India, just like welfare for Britain’s own poor, as a convenient whipping boy.