India halves aid to Bangladesh in Budget 2026–27:Cuts funds for Maldives and Myanmar; Bhutan allocation increased to ₹2,288 crore

The Indian government has sharply reduced financial aid to Bangladesh in the Union Budget 2026-27. Only ₹60 crore has been allocated this year, compared to ₹120 crore last year. This means India has cut its aid to Bangladesh by half. The move comes at a time when ties between India and Bangladesh are under strain. The reasons include continued violence against minorities, especially Hindus, in Bangladesh, and changes in the country’s foreign policy. After the fall of Sheikh Hasina’s government in 2024, Bangladesh has begun improving relations with Pakistan. Major allocation made by India Apart from Bangladesh, the Maldives has been allocated ₹550 crore, which is lower than last year. Myanmar will receive ₹300 crore, also a reduced amount. In contrast, Bhutan has been given ₹2,288.55 crore, around ₹138 crore more than last year. India has allocated ₹2.25 billion to African countries, ₹1.2 billion to Latin American countries, and ₹3.8 billion to Eurasian countries in its budget. However, it is unclear how much money will be allocated to each country in these regions. The total budget of the Ministry of External Affairs is more than Rs 22,000 crore. The Government of India has set a total budget of approximately ₹22,118 crore for the Ministry of External Affairs for 2026–27. This includes both office expenses and other essential functions. This amount is slightly higher than last year. The Ministry of External Affairs also funds the secretariat, embassies and missions abroad, passport and immigration matters. The government will spend approximately ₹9,500 crore on these. Apart from this, India also provides financial assistance to other countries. For this, Rs 5,685.56 crore has been allocated in the budget for 2026–27. This amount is approximately Rs 100 crore less than last year. Last year, in 2025–26, Rs 5,785.40 crore was allocated for this item.
India says, We are monitoring the situation of minorities in Bangladesh The Indian government, through the Ministry of External Affairs (MEA), has expressed concern to the Rajya Sabha regarding attacks on minorities in Bangladesh. These attacks have included targeting homes, shops, properties, and places of worship. The MEA stated that India has consistently raised the issue of minority safety with the Bangladeshi government, including a discussion between Prime Minister Modi and Chief Advisor Mohammad Yunus in April 2025. The MEA also criticized the Bangladeshi interim government’s response to these attacks, claiming they are often downplayed, which emboldens offenders and increases fear among minority communities. Also Read | Bangladesh cancels land allotment for Indian SEZ Bangladesh is strengthening ties with Pakistan Bangladesh’s current government is actively strengthening relations with Pakistan, a significant shift given the atrocities committed during Bangladesh’s independence in 1971. Direct cargo ships are now operating between the two countries, and direct flights are expected to start soon. Pakistani airlines Fly Jinnah and Air Sial have received approval to operate these services. Recently, a flight from Dhaka landed in Karachi, restoring direct air travel after 14 years. Amid these developments, India–Bangladesh relations have continued to worsen since 2024. No funds for the Chabahar Port project The Indian government has not allocated any funds for Iran’s Chabahar Port project in the Union Budget 2026–27, according to news agency PTI. In previous years, India had been providing around ₹100 crore annually for the project. The Chabahar Port, located in Iran’s Sistan-Balochistan region, has been developed with major Indian support. The decision comes as the United States has imposed fresh and stricter sanctions on Iran. On January 13, US President Donald Trump warned on social media that countries doing business with Iran could face additional tariffs of up to 25%. Since then, India has been reviewing its options regarding the Chabahar Port project. In September last year, the US imposed tough economic sanctions on Iran. Although India received a special six-month exemption for Chabahar, this waiver is due to expire on April 26. Also Read | Congress alleges PM lost control over Iran’s Chabahar Port
India strengthens relations through foreign aid India has long provided economic assistance to neighboring countries. This aim is to maintain political influence in the region and strengthen vital economic relationships. This policy has now become a key part of India’s foreign policy. The world is no longer the same as it once was, where only the rich and powerful nations made decisions. Now, the role of developing countries, or the Global South, is growing, and powerful nations like India are expanding their influence through mutual partnerships and investments. When neighboring countries become stronger, both India’s security and trade benefit. India’s financial resources are invested in roads, electricity, schools, hospitals, ports, and other development projects. This improves the economies of these countries and provides opportunities for Indian companies to operate there. India also often assists humanitarian reasons, such as during natural disasters, economic crises, or health crises. This contributes to India’s global image as a responsible and helpful nation.