N. V. GALISHCHEVA
Candidate of Economic Sciences
India Keywords:, official development assistance, South Asia, Africa
In the last two decades, new major creditor countries such as China and Brazil have emerged in the global financial market. It is noteworthy that they are not members of the Development Assistance Committee of the Club of Developed Countries - the Organization for Economic Cooperation and Development (OECD). India, which until recently was primarily a recipient of foreign aid in the form of loans, plays a very prominent role among new lenders. However, since the late 1990s. India is gradually transforming into a major financial donor to developing countries.
Such a change in India's status is primarily due to the success achieved through well-conducted liberal economic reforms: a noticeable increase in its economic power, a rapid increase in the volume of gold and foreign exchange reserves, etc. Today, India is the 5th largest donor to Afghanistan, and an important source of aid to its neighbors in the region - Nepal, Bhutan, Sri Lanka, Myanmar, as well as to African states, to which the volume of Indian loans has increased annually by an average of 20% in the.
LONG ROAD FROM RECIPIENT TO DONOR
The economic development of India in the first decades after independence was largely based on foreign loans, which was dictated by the need to find monetary resources to finance the creation of basic industries. Due to the lack of domestic mobilization funds, the Indian Government was often forced to resort to a policy of deficit financing, which inevitably led to an increase in the rate of inflation. On the other hand, periodic borrowing in the domestic market led to an increase in the volume of the domestic component of public debt.
Foreign aid in the form of loans proved to be the" lifeline " that India firmly clung to, especially in 1951-1979. Its share in the total amount of funds raised for the development of the Indian economy ranged from 10% to 30% in ... Read more