New Delhi: India’s Finance Minister Nirmala Sitharaman presented the Union Budget for 2026-27, marking her ninth consecutive budget presentation. Under the ‘Neighbourhood First’ policy, the Ministry of External Affairs has been allocated ₹22,118.97 crore for foreign aid, a slight increase from last year’s ₹20,516.61 crore.
This year, India has revised its financial assistance to several countries, increasing budgets for some while reducing aid to others.
The budget reflects a notable increase in aid to Bhutan, India’s closest strategic partner, with assistance rising to ₹2,288.55 crore. This increase underscores the strong bilateral ties, especially in hydropower and infrastructure development sectors.
Financial aid to Afghanistan has tripled from ₹50 crore to ₹150 crore, reaffirming India’s ongoing commitment to humanitarian and development support in the region.
Nepal’s allocation has been increased by ₹100 crore to ₹800 crore, and Sri Lanka’s aid has also gone up by ₹100 crore to ₹400 crore. India recently provided assistance to Sri Lanka in response to Cyclone Doviya, and this budget adjustment aligns with the country’s recovery needs.
Mongolia’s aid has been raised from ₹5 crore to ₹25 crore, while Mauritius sees a significant jump from ₹50 crore to ₹550 crore. Seychelles’ allocation remains steady at ₹19 crore, the same as last year.
In contrast, India has significantly reduced financial assistance to Bangladesh, allotting ₹60 crore compared to last year’s ₹120 crore. This reduction follows the underutilisation of funds, with only ₹34 crore spent previously. Myanmar and the Maldives are also included in the aid list, with allocations of ₹300 crore and ₹550 crore respectively.
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