India to create agency for bilateral aid

NEW DELHI: With the country shifting gears from being an aid recipient to a donor nation, India may soon have its official agency for developmental aid. This is also in line with the country���s emergence as an economic power. The government is working on a plan to create an agency on the lines of Japan International Cooperation Agency (JICA) and South Korean International Cooperation Agency (KOICA) for handling development aid, official sources told SundayET.

The ministry of external affairs is giving final shape to the agency. The agency will be the single window to provide India���s technical assistance and other forms of aid to other countries. During 2006-07, India made a commitment of $1 bn (Rs 4,000 crore) for bilateral co-operation out of which over $500 mn (Rs 2,000 cr) was disbursed.

Due to lack of a dedicated agency for bilateral co-operation, a division of external affairs now handles the proposals for donation, which come from various developing and underdeveloped nations. It is then routed through the department of economic affairs (DEA) under the ministry of finance before the final list of projects is short-listed.

���The creation of a dedicated agency will always help in streamlining bilateral aid from India. As India is becoming a major economic power, it���s expected that more funds will be disbursed as bilateral aid. In that case, a dedicated agency to handle aid will be helpful,��� sources said. In fact, India has been late in creating such an agency if compared to its peers such as South Korea and China. KOICA was established in 1991 to manage grant aid and technical cooperation programmes.