USAID Funding to India Faces Uncertainty Amid Policy Shift

Why in the News?

The Trump administration’s executive order aims to cut foreign aid, threatening USAID-funded health, sanitation, and energy projects in India. A US federal court has temporarily stayed the decision, but the future of funding remains uncertain.

USAID Funding to India Faces Uncertainty Amid Policy Shift

About USAID’s Contributions to India:

  • Since 2001, USAID has provided $2.8 billion in Official Development Assistance (ODA) to India.
  • Major funding areas include health, population, environment, education, energy, and business initiatives.
  • USAID played a crucial role in India’s polio eradication, maternal health, HIV/AIDS, tuberculosis control, and water sanitation programs.
  • The agency also contributed to India’s clean energy initiatives and climate conservation efforts.
  • In 2022, USAID ranked fourth among international donors to India, after Japan, the European Union, and Germany.

Impact of USAID Programs in Recent Years

  • USAID disbursed $228 million in 2022, $175 million in 2023, and $151 million in 2024 (as of December).
  • A significant portion of the funds supported health and population programs, with notable allocations for COVID-19 relief, maternal and child health, and family planning.
  • Key USAID-funded projects in India include:
    • Momentum 3B (Immunization) – $20.6 million (till June 2026).
    • RISE (HIV control) – $7.1 million (till December 2025).
    • Suwasi (Water and sanitation) – $4 million (till March 2026).
    • Cleaner Air & Better Health – $1.5 million (till October 2026).

Uncertainty Over Future Funding

  • A January 20 executive order by the Trump administration aimed to cut foreign aid and phase out USAID.
  • If implemented, several USAID projects in India and other developing nations would face termination.
  • Programs like TB awareness in Karnataka, Bihar, Telangana, and Assam would be severely impacted.
  • The move has faced criticism, with experts warning that thousands of lives are at risk due to halted funding for HIV/AIDS treatment and healthcare programs.
  • A US federal court temporarily stayed the decision, but the Biden administration’s stance on future aid remains uncertain.

What is USAID?

  • Establishment & Purpose:
  • Founded in 1961 by President John F. Kennedy.
  • Consolidates foreign assistance programs to administer civilian aid.
  • Funded through the U.S. federal budget.
  • Top Recipient Countries:
  • Ukraine, Ethiopia, Jordan, Somalia, etc.
  • Objectives & Areas of Work:
  • Operates in 100+ countries in sectors like:
  • Economic development
  • Health & education
  • Food security & humanitarian aid
  • Climate change mitigation
  • Democracy & governance
  • Key Initiatives:
  • PEPFAR: HIV/AIDS treatment & prevention.
  • Feed the Future: Tackling hunger & food security.
  • Power Africa: Expanding electricity access.
  • Water for the World Act: Improving water & sanitation services.