Lok Sabha Question No. 310 (STARRED), answered on 2026-03-13
Subject: Strategic Challenges to Neighbourhood Policy
Ministry: EXTERNAL AFFAIRS
Asked by: Shri Brijmohan Agrawal

## GOVERNMENT OF INDIA

## MINISTRY OF EXTERNAL AFFAIRS

## LOK SABHA

## STARRED QUESTION NO. 310

## ANSWERED ON 13/03/2026

## STRATEGIC CHALLENGES TO NEIGHBOURHOOD POLICY

## *310. SHRI BRIJMOHAN AGRAWAL

Will the Minister of EXTERNAL AFFAIRS be pleased to state:

(a) whether the Government has assessed India's strategic influence in the neighbourhood following recent regime changes and rising sentiments in countries like Maldives and Bangladesh, if so, the details thereof;

(b)   the   diplomatic   and   security   measures   planned   to   counter   the increasing   Chinese   "Dual-Use"   maritime   activity   and   infrastructure expansion in the Indian Ocean Region;

(c) the total budget allocation for 'Aid to Neighbours' in the 2026-27 Union Budget compared to the last three years;

(d) whether the Government has any proposal to shift from "Grant-based" aid to a "Project-Completion" model to address chronic delays in Indiafunded infrastructure in Nepal and Sri Lanka, if so, the details thereof; and (e) the roadmap to formalize BIMSTEC as the primary regional alternative to the currently SAARC framework?

## ANSWER MINISTER OF EXTERNAL AFFAIRS

## (DR. SUBRAHMANYAM JAISHANKAR)

## (a to e) A statement is laid on the Table of the House.

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STATEMENT REFERRED TO IN REPLY TO PARTS (A) TO (E) IN RESPECT OF LOK SABHA STARRED QUESTION NO 310 BY SHRI BRIJMOHAN AGRAWAL FOR REPLY  ON 13.03.2026   REGARDING  STRATEGIC   CHALLENGES   TO NEIGHBOURHOOD POLICY.

The Government is constantly monitoring all geopolitical developments, including   those   in   its   neighbourhood,   that   have   a   bearing   on   India's national   interest.   Amidst   uncertainties   and   challenges   of   geopolitical tensions   and   shifting   equations,   the   Government   has   taken   steps   to strengthen India's strategic position and protect its national interests.

Maldives   continues   to   remain   an   important   partner   under   India's 'Neighbourhood   First'   policy   and   Vision   MAHASAGAR   i.e.   Mutual   and Holistic   Advancement   for   Security   and   Growth   Across   Regions. Presidential elections were last held in Maldives in 2023. Since then, President Dr. Mohamed Muizzu of Maldives visited India in October 2024 and Prime Minister Shri Narendra Modi visited Male as the 'Guest of Honour' on Maldives National Day in July 2025. The two sides adopted India-Maldives   joint   vision   for   Comprehensive   Economic   and   Maritime Security Partnership during President Muizzu's visit.

Bangladesh lies at the converging point of India's 'Neighbourhood First' policy as well as the 'Act East' policy. India's approach to Bangladesh has always   been   and   will   continue   to   be   focused   on   people-centric development.   India   views   Bangladesh   as   an   important   neighbour   and development partner in South Asia and seeks positive, constructive and forward-looking   engagement   with   the   newly   elected   Government   of Bangladesh   to   advance   the   shared   interests   of   the   people   of   both countries in the political, security, economic and cultural domains.

The Government is aware that as part of its global strategy, China has been developing ports and other infrastructure facilities in the littoral countries in the Indian Ocean Region over many years. China also has naval and maritime presence in the Indian Ocean Region including through anti-piracy escort missions, port calls and deployment of research and survey   vessels.  Government   closely   monitors   all   developments   in   the Indian Ocean Region impinging on India's security and economic interests and takes appropriate measures to safeguard India's interests.  India's relations with countries, including those of the Indian Ocean region, stand on   their   own   footing   and   are   independent   of   the   relations   of   those countries with third countries.

The details of budget allocation under 'Aid to Neighbours' from F.Y 202324 to 2026-27 are enclosed.

The   Government   deeply   values   its   development   partnership   with neighbouring   countries,   including   Nepal   and   Sri   Lanka,   and   is   fully committed   to   the   timely   completion   of   all   the   on-going   bilateral development and infrastructure projects, both grants-based and loansbased. The   Government   has   been   extending   necessary   developmental assistance and capacity building initiatives, as per needs and aspirations of   the   neighbouring   countries   and   works   closely   with   the   relevant authorities of partner countries to address any challenges in this regard.

Government of India has undertaken several India-funded infrastructure projects   in   Nepal   across   sectors   including   health,   education   and connectivity. These projects are funded through grant assistance or Lines of Credit and vary in scale, ranging from small development projects to large projects. India-funded infrastructure projects in Nepal are guided by relevant bilateral understanding/documents, which outline, inter-alia, the scope of   cooperation,   responsibilities   of   various   stakeholders,   project financing,   timelines   and   monitoring   mechanisms.   Once   a   project   is initiated, concerted efforts-including regular site visits, follow-ups with

contractors/consultants and   periodic bilateral project monitoring meetings-are made to ensure its timely completion.

India's development cooperation with Sri Lanka is in accordance with the priorities of  the Government of  Sri Lanka and the needs of  its people. India's overall assistance in this sphere amounts to more than USD 7.5 billion   as   concessional   loans/swap   arrangements   and   almost   USD   850 million as grants. Financing modalities of India's initiatives are decided in conjunction with the Government of Sri Lanka and with an aim to ease the debt burden and assist in the economic recovery of Sri Lanka.

In   line   with   its   'Neighbourhood   First'   policy,   'Act   East'   policy   and MAHASAGAR   vision,   India   has   been   working   with   its   partners   to strengthen regional cooperation in the neighbourhood. India has been taking several initiatives towards capacity and institution building in the BIMSTEC region, including providing grants to the BIMSTEC Secretariat, building Centres of Excellence in several areas, and organizing capacitybuilding and training programmes, business exchanges, youth exchanges, and   cultural   exchanges.   India's   approach   and   commitment   towards enhanced regional cooperation in the BIMSTEC region are focused on strengthening   security   (both   traditional   and   non-traditional   including

maritime and cyber security, climate security, disaster preparedness, food security and human security) and increasing connectivity (trade, energy, transport, digital and people-to-people connectivity).

## Budget allocation under 'Aid to Neighbours' from F.Y 2023-24 to 2026-27

| Total Budget Allocation for 'Aid to Neighbours' in FY 2026-27 Union Budget compared to the last three years   | Total Budget Allocation for 'Aid to Neighbours' in FY 2026-27 Union Budget compared to the last three years   | Total Budget Allocation for 'Aid to Neighbours' in FY 2026-27 Union Budget compared to the last three years   | Total Budget Allocation for 'Aid to Neighbours' in FY 2026-27 Union Budget compared to the last three years   | Total Budget Allocation for 'Aid to Neighbours' in FY 2026-27 Union Budget compared to the last three years   | Total Budget Allocation for 'Aid to Neighbours' in FY 2026-27 Union Budget compared to the last three years   |
|---------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------|
| Head                                                                                                          |                                                                                                               | Budget allocation (Rs. in crore)                                                                              | Budget allocation (Rs. in crore)                                                                              | Budget allocation (Rs. in crore)                                                                              | Budget allocation (Rs. in crore)                                                                              |
|                                                                                                               |                                                                                                               | 2023-24                                                                                                       | 2024-25                                                                                                       | 2025-26                                                                                                       | 2026-27 (Proposed)                                                                                            |
| Aid to Bangladesh                                                                                             |                                                                                                               | 200.00                                                                                                        | 120.00                                                                                                        | 120.00                                                                                                        | 60.00                                                                                                         |
| Aid to Bhutan                                                                                                 | Gra nts                                                                                                       | 1632.24                                                                                                       | 1078.86                                                                                                       | 1775.00                                                                                                       | 1768.64                                                                                                       |
|                                                                                                               | Loa n                                                                                                         | 768.34                                                                                                        | 989.70                                                                                                        | 375.00                                                                                                        | 519.92                                                                                                        |

| Aid to Nepal                    |   550.00 |   700.00 |   700.00 |   800.00 |
|---------------------------------|----------|----------|----------|----------|
| Sri Lanka- Other Aid Programmes |   150    |   245    |      300 |   400    |
| Aid to Maldives                 |   400    |   400    |      600 |   550    |
| Aid to Myanmar                  |   400    |   250    |      350 |   300    |
| Aid to Afghanistan              |   200    |   200    |      100 |   150    |
| Total                           |  4300.58 |  3983.56 |     4320 |  4548.56 |

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