UK likely to cut Indian aid, focus on trade

The British government, under pressure from Tories and others to slash its annual foreign aid bill, is likely to slash its £1 billion aid bill to India.

Justine Greening, who took over from Andrew Mitchell as international development secretary last month, said she wants to see Britain's links to richer developing nations become about business rather than hand-outs.

Greening's comments came amid pressure on her to get better value for money from Britain's £12 billion annual spending on countries like Kenya and India. The coalition government has come under pressure from many Tories for putting a ring-fence around the Department for International Development's (DfID) budget even as other government departments are suffering budget cuts.

Signalling that India will be a target for cuts, she told a Tory Party conference in Birmingham, "We should recognize that as countries get richer, we need to be responsible about how we transition in our relationship with them from aid to trade. Those are the discussions that I am having with the Indian government at the moment."

Greening said it was right for Department for International Development (DfID) to end aid to China and Russia as the department focused on countries less able to help themselves. As countries become richer, the UK needed to move the relationship beyond aid to trade, said Greening, adding that she planned to have discussions with India on their trading ties.

"As countries develop, they become bigger markets. Look at China and India – we exported nearly £15billion to them last year," she said. "If you talk to Jaguar Land Rover, whose fastest growing export market is China, they'll tell you how important this is because it creates jobs and investment here in the UK."