India allocates Rs 300 Crore to Sri Lanka in Union Budget
- CNL Reporter
- February 2, 2025
- Political
- India allocates Rs 300 Crore to Sri Lanka in Union Budget
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In the Union Budget 2025, Sri Lanka’s allocation for developmental aid remained unchanged at Rs 300 crore, continuing the same level as the previous fiscal year.
Despite facing its worst economic crisis in 2019, Sri Lanka is now in the process of recovery, and India’s consistent support through aid reflects the importance of maintaining stable ties with its neighboring island nation.
Maldives has received the highest increase in developmental aid among other South East Asian countries in the Union Budget 2025 following an acrimonious year in which ties between the two nations hit rock bottom. Maldives, which saw a cut in allocation in 2024, saw a nearly 28 per cent increase in outlay in the 2025 Budget that was presented by Finance Minister Nirmala Sitharaman on Saturday.
According to the Budget document, the allocation for the Maldives in 2025-26 has been pegged at Rs 600 crore. It is a substantial increase from the Rs 470 crore given to the island nation in the 2024-25 fiscal year.
Interestingly, Maldives was allocated Rs 600 crore in the interim Budget of 2024, the year general elections were held. After the Narendra Modi government came to power, the outlay to the Maldives was cut to Rs 400 crore in the full Budget presented in July. The allocation was later revised to Rs 470 crore.
The cut in allocation came as ties between India and Maldives nosedived after some Maldivian leaders made derogatory remarks against Prime Minister Narendra Modi following his visit to Lakshadweep in January 2024. PM Modi’s visit was seen by the Maldives as a bid to wean away tourists from the island nation to Lakshadweep.
However, ties improved after President Mohamed Muizzu, who came to power based on an ‘India Out’ campaign, visited India in October last year. During bilateral talks with PM Modi, Muizzu acknowledged that India was a “key partner”.
The government, in line with its ‘neighbourhood first’ policy, allocated the largest share of Rs 2,150 crore as development aid to Bhutan, followed by Nepal at Rs 700 crore. Maldives was in third at Rs 600 crore, followed by Mauritius, which saw its outlay pegged at Rs 500 crore. The country saw a cut in its allocation from last year, when it received Rs 576 crore in aid from India.
Restive Myanmar also saw a cut in its Budget to Rs 350 crore from Rs 400 crore.
African countries also saw an increase in their outlay from Rs 200 crore to Rs 225 crore.
