Budget support to Bangladesh halved amid strained ties
India Today
Bangladesh faces one of the steepest cuts in India's foreign aid, with its allocation reduced from Rs 120 crore to Rs 60 crore, even as assistance to most other neighbouring countries has been maintained or increased.
India has sharply reworked its overseas development assistance in the Union Budget 2026-27, cutting aid to Bangladesh by half, a move that reflects the growing strains in bilateral relations amid reports of rising anti-Hindu incidents and killings in the neighbouring country.
Bangladesh faces one of the steepest cuts in India’s foreign aid, with its allocation reduced from Rs 120 crore to Rs 60 crore, even as assistance to most other neighbouring countries has been maintained or increased.
The document also revealed that while India had allocated Rs 120 crore for Bangladesh, of which only Rs 34.48 crore was actually spent due to the tense relations.
Meanwhile, Bhutan continues to top the list of countries receiving Indian assistance, followed by Nepal, Maldives and Sri Lanka. The allocation under “Aid to Countries” has been increased to Rs 5,686 crore, about 4% higher than last year’s Budget Estimates of Rs 5,483 crore.
A major shift in the budget is the complete absence of funding for the Chabahar port project. India had spent Rs 400 crore on the project in 2024-25 and initially allocated Rs 100 crore in the 2025-26 Budget Estimates, later raising it to Rs 400 crore in the Revised Estimates.
For 2026-27, the allocation has been reduced to zero.
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