Why did Donald Trump’s administration stop financial aid to India under the United States Agency for International Development (USAID)?

Has India become so rich that it does not need foreign assistance anymore?

Do the Indian NGOs receiving the USAID funds work against the interests of Washington?

Is it a strategy to arm-twist India to get concessions for something else like bilateral trade?

Donald Trump: India Has A Lot More Money

After Department of Government Efficiency (DOGE) chief Elon Musk announced freezing $21 million in financial assistance to India to increase voter turnout in elections, eyebrows were raised.

However, US President Donald Trump defended the decision and asked why Washington should give aid to India, which has enough money.

He said, “Why are we giving USD 21 million to India? They have a lot more money.”

He asked, “I have a lot of respect for India and their Prime Minister, but giving USD 21 million for voter turnout?”

Donald Trump Angry At High Tariffs In India?

However, Trump is peeved at high tariffs on US imports to India.

Earlier, he accused New Delhi of adopting protectionist policies, not opening the market and not allowing the US firms a level playing field.

His anger burst out as he said without mincing words, “They are one of the highest taxing countries in the world in terms of us; we can hardly get in there because their tariffs are so high.”

Analysts believe, that besides high tariffs, the Trump administration is not happy with the NGOs receiving the USAID funds. It has

Strings Attached With USAID Funding

Analysts believe strings remain attached to USAID funding as development assistance is not completely apolitical and serves certain purposes of the donor.

It is challenging for the donour country as well as the recipient nations. After the money is spent, it creates new interest groups and sometimes the groups clash with old interest groups.

It is a fact that bilateral grants influence not only the development or society but also the politics of the recipient country.

Diplomats of the donour country have to keep an eye on the NGOs and analye how and where the money is spent.

It is also to be analysed how the money spent helps the US interest.

Blame Game Over USAID

The Donald Trump administration may also be upset over the politics and blame game being played over the USAID in India.

BJP IT cell chief Amit Malviya took to social media platform X as he wrote in a post, “It is becoming increasingly evident that the Congress-led UPA systematically enabled the infiltration of India’s institutions by forces opposed to the nation’s interests – those who seek to weaken India at every opportunity.”

Sharpening the attack, he went on to add that “billionaire US-based investor George Soros, a known associate of the Congress party and the Gandhis, whose shadow looms over our electoral process.”

What Is USAID?

Established by then US President John F. Kennedy in 1961 to unite foreign assistance organisations and programmes under one umbrella, the agency implements programmes in disaster relief, socioeconomic development, global health, environmental protection, democratic governance and education.

One of the largest aid agencies of the world, the USAID has an average budget of $23 billion. Its mission is spread in more than 100 countries.