Examination of Witnesses (Questions 37-39)
DR CHARLOTTE SEYMOUR-SMITH, MRS ARUNA BAGCHEE AND
MR JEREMY CLARKE
5 JULY 2004
Q37 Chairman: Welcome.
Dr Seymour-Smith, presumably you are based in Delhi and Jeremy
is based here in London?
Mr Clarke: Yes.
Q38 Chairman: Aruna,
I am not quite sure whether you are based in Delhi or London?
Mrs Bagchee: I
am based in Delhi.
Chairman: We now know
where everyone is coming from. Thank you very much for coming
and helping us with our inquiry. Obviously India has the largest
bilateral development programme from DFID and it is a topic in
which we are understandably interested. Piara is to begin with
the first question.
Q39 Mr Khabra: This
is a question to which the Committee are very keen and interested
to know the answer and that is, why should DFID be committed to
further and indeed enhanced levels of assistance to India given
its status as it is in the modern circumstances, the attitude
to aid and potential to meet the income poverty Millennium Development
Goal (MDG) without assistance? Why not switch resources to parts
of Africa or other parts of South Asia where there is more poverty?
This is a question which has been asked before and I would like
to repeat it again.
Dr Seymour-Smith: Perhaps
I will start trying to give an answer to that question and bring
in Jeremy and Aruna in support. First of all, looking at the way
that DFID allocates its aid overall - and Jeremy can perhaps say
a little more - we are looking at numbers of people in poverty
which, in the case of India, are extremely high. If we measure
by the international poverty line of one dollar a day, there are
between 300 and 350 million people in India below that poverty
line and even measuring by the more modest national poverty line,
there are around 260 million people below the national poverty
line. These are extremely large numbers and I think a development
agency that did not pay some attention to those large numbers
would be remiss. We also look, besides the criteria of population
and need, at the policy environment. Is this a country where we
think aid can be well used and, if we direct aid towards this
country, will it actually deliver outcomes? Will it deliver poverty
reduction? If we look at the overall policy environment in India,
we have to say that, yes, there are significant opportunities
for donor assistance to be used to reduce poverty. So, by all
of the criteria we would normally use, India is under-aided by
DFID and by the donor community in general. It is a country where,
in principle, we believe more aid could be well used and well
absorbed. However, we have to recognise also that, as a large
country and a country that aspires to be a self-reliant international
player and a country that has significant resources of its own,
perhaps that theoretical position that India is under-aided needs
to be adjusted somewhat. The previous Government had expressed
very clearly its desire to graduate from being an aid recipient
and indeed its interest in becoming a donor in its own right.
We have not yet had discussions with the new Government and we
do not know whether they share those views on India as an aid
recipient and India as a potential donor. The answer to the question,
should we switch aid to other parts where there is greater need
or more depth of poverty, is that I do not think so. I think that,
if anything, we should be giving more aid to India if we can identify
suitable opportunities for it to be well used, but perhaps Jeremy
would like to add a word from the regional perspective on this
question.
Mr Clarke: I do
not think I can add too much to that. I think the aid allocation
model that we use does in fact include the criteria that Charlotte
has set out. It also includes a cap on population, a sort of factor
for adjustment that we include in the calculations which in effect
limits the amount of aid that we provide to India and ensures
a distribution to other poorer countries and across the regions
to Africa.
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