Dodgy development: DfID in India


India is the biggest single recipient of British aid, with £1 billion spent between 2003 and 2008 through the UK’s Department for International Development (DfID). This article, written for Corporate Watch by Richard Whittell, introduces a series of short films and interviews about the DfID in India to be published over the coming weeks, which were shot by Whittell and Indian activist Eshwarappa M during a trip to various parts of the country affected by British money. Their experience meeting people whose lives have been directly affected by DfID activities, as well as evidence and opinions provided by activists, academics, journalists, state employees and DfID staff, did not tally with the claims made for British aid by DfID’s publicity.


Click here for the book and DVD of the Dodgy Development series, with full interview transcripts and extra footage.


Development opportunities

“I believe our approach offers the best hope for reversing the conditions that lead to hunger and division, and for building a more prosperous, just and stable world.” – Tony Blair, 2003

“Foreign aid is not needed. It is an extension of national and international politics and it serves their interests… Our understanding is that the DfID has never worked for poverty alleviation. They want to perpetuate poverty because they want to expropriate the natural resources of third world countries, but with a human face.” – Bijay Pandey, secretary of the Adivasi Mukhti Sangathan people’s movement in the central state of Madhya Pradesh

The Department for International Development (DfID) was set up in 1997 by the newly elected Labour government, which took it out of the Foreign and Commonwealth Office and gave it a minister of cabinet rank (currently Douglas Alexander). Both Tony Blair and Gordon Brown have made much of their commitment to ‘fighting poverty’, which has brought them far more praise than their other foreign policies.

In their audit of New Labour’s record in government, Polly Toynbee and David Walker, for example, describe the DfID as “the department of Labour’s conscience.” While decrying New Labour in 2008 as “the most rightwing government Britain has had since the Second World War,” George Monbiot nevertheless felt the increase in foreign aid was a “real achievement” that “deserves to be celebrated.” Earlier this month, the UN’s Kevin Watkins claimed that “whatever your take on New Labour, its credentials on development are impressive… As a nation we have become more generous in our dealings with the world’s poorest people, moving from the lower leagues to the premier division of leadership on poverty reduction.” Mindful of the sheen of humanitarianism that foreign aid brings, David Cameron has promised to maintain DfID’s budget if the Conservatives win the May elections.


DfID in India

“Because a third of the poor people in the world live in India, this has been DFID’s largest country programme for more than a decade. In a country of this size, it is a bold ambition to give every mother the healthcare she needs to give birth in safety and raise a healthy child, to give every child a chance to learn and enough food to eat.” – International Development Secretary Douglas Alexander

Between 2003 and 2008, India received £1 billion of British aid money. At the beginning of 2009, the DfID released its new country strategy for India after Gordon Brown, flanked by smiling children and the odd Bollywood star, committed to giving another £850 million until 2011.

The DfID works both at the national level (in support of the Indian government’s centrally sponsored schemes) and at state level in Madhya Pradesh, Orissa, Bihar, Andhra Pradesh and West Bengal, often in conjunction with other development agencies such as the World Bank and the Asian Development Bank. It has its head office in New Delhi and state offices in Bhopal, Bhubaneswar and Kolkata.

According to its India brochure, the DfID’s priorities have been “strengthening the capacity of government to develop and implement pro-poor policies; promoting increased investment in education, health and water; supporting programmes which help poor people improve their own livelihoods and promoting sustainable management of the earth’s resources.”

With these priorities in mind, this article provides a brief introduction to the five parts of our series about the DfID in India.


Smile for the camera

The first part looks at a DfID-funded Rural Livelihoods Project in the central state of Madhya Pradesh. Through this project, people have been encouraged to grow the oil-bearing jatropha plant on their common land, described by the project as ‘wasteland’, and sell it to companies to make biodiesel. Among these companies is the British biodiesel company D1 Oils, which is currently cultivating jatropha, together with BP, on 350,000 hectares around India.

The project staff and documents claim that the choice to grow the jatropha has been made democratically, by all members of the village. However, the vast majority of people we met –in an area recommended to us by one of the project staff as one of the ‘best examples’ of the project’s democracy in action- said they had not been involved at all in the decision-making process and did not think they would benefit at all from it, as it was taking up the common land many of them depended on for grazing and resources. The only person who was unambiguously positive was the village headman’s brother, who we were taken to meet by the NGO that had been contracted to implement the project in the area.

Of course, the dissenting voices were not meant to be heard and we were only able to record interviews with people who had not been shown the script beforehand as Eshwarappa and Madhuri Krishnaswammy, a member of the Jagrit Dalit Adivasi Sangathan people’s movement present in the area, who we had met on the way, were able to nip away from the main tour and speak to people without the NGO staff watching over their shoulders. In an interview after this, Krishnaswammy told us:

“This participatory process is almost entirely on paper… village elites are persuaded to form a small group and they’re persuaded that this will be good for them in the future. There has been no informed consent. And in these villages I don’t know personally of any single village where there has genuinely been a village council of a substantial body of adult members participating in that, sitting, discussing, thrashing things out, thinking about it and then taking an informed decision. I don’t know of a single village where that has happened.”

The project, therefore, seems to have reinforced a decision-making structure in the village that had never been representative of the majority of the people who live in it, while, at the same time, enmeshing the interests of the village leaders with those of international markets. But with testimonies from people like the one given by the headman’s brother, and the positive evaluation conducted by bodies contracted by the DfID, the whole area is used as a statistic to show how many people British aid money has reached.


The new Raj

The next part of the series scrutinises the claim that DfID’s public sector reforms have helped state governments become more ‘pro-poor’.

The government of the north-eastern state of Orissa signed an aide memoire with the World Bank and the DfID in 2000, in which it was guaranteed World Bank and DfID money to address its fiscal deficit, as long as it undertook “a program to reform the business and direction of government.”

The reforms have, indeed, done that, though their greatest beneficiaries have not been the majority of people in the state but multinational mining companies. In conjunction with a series of reforms commercialising the water and power sectors, the Industrial Policy Resolution and the Orissa Rehabilitation and Resttlement Policy, jointly written and funded by the DfID in 2001 and 2006 respectively, encouraged companies such as Vedanta, POSCO and Tata to come and mine the bauxite, coal and iron ore under the state’s lands, paying rates of tax that do little to fill the state’s already depleted coffers and displacing thousands of people.

In an interview, journalist Sudhir Patnaik explains:

“We call Orissa a DfID colony. This is not acceptable to anybody who has a sense of democracy. We do not accept a foreign government department coming here and dictating and influencing government departments to do this and to do that. And if you come to the core point, what is their understanding of development in Orissa? If you see the kind of development happening in Orissa, it means developing only industries, mineral-based industries. How many people in the state will benefit from this?”

The reforms provoked a wave of resistance as people refused to make way for this particular development vision. The campaign of the people living in the areas wanted by South Korean steel company POSCO is the subject of our second film, in which Abhay Sahoo, the secretary of the anti-POSCO movement, explains:

“For the last three years, the people of these areas have been conducting a struggle for their fertile soil… we are 100% opposed to the POSCO and we refute the rehabilitation policies of the state government, which were made in connivance with the DfID, which has privatized the government and the public sector of our state.”



Funding for education is the subject of the third part of the series. The £200+ million given for education turns out to have gone to a central government programme that has led to a continued decline in the quality of government schools, over-burdening teachers, and building schools that lack basic infrastructure such as functioning toilets, and generally demeaning the value, spirit and ambition of the public education system.

When shown quotes from Gordon Brown describing how much a DfID-funded programme has reduced the number of children out of school, Anil Sadgopal, professor of education at the University of Delhi, asks:

“What reduction is he talking of? In order to prove you are succeeding, you count the number of children on registers, and say, a-ha, they are there! Enrollment is not equal to attendance, and attendance is not equal to learning… Are these things not important in British schools? And yet prime minister Brown says remarkable progress is being made. What criteria is he using?”

Mrs Manjula, a parent in a low-income area of Bangalore, explains in the film how, as the public school system declines, more and more parents have to spend a significant amount of their income to send their children to the fast increasing number of private schools:

“Before, government schools would give a good education… but now, if you want your children to do well, you have to send them to private schools, even if you can barely afford it.”


Power to the people?

Among the most regularly quoted achievements of British aid in India are the power sector reforms that the DfID funded and administered with the World Bank in the states of Orissa, Madhya Pradesh and Andhra Pradesh. The claim that they have created an ‘up-to-date’, ‘efficient’ and ‘financially sustainable’ power sector is disputed in the fourth part of the series. Terms such as these obscure the fact that this financial sustainability has only been achieved by commercialising and privatising the sector, leading to increased disconnections of people who cannot afford to pay the markedly higher prices that result. People living in a slum in Bhopal, Madhya Pradesh, show us how these disconnections have forced them to tap into power lines from the local government offices as their only source of power, only to be cut off again by the ‘crackdown on theft’, which the DfID claims is another achievement of the reforms. The secretary of the employees’ union, which was ignored in the discussions regarding the reforms, tells us:

“The reforms were based on cutting the cost of the supply, not the needs of the people. This was advocated by consultants brought in by the DfID. We have pleaded that electricity be treated as an essential service that you cannot apply commercial principles to… The employees were never consulted by the DfID; the unions were not taken into confidence and the consultants brought in by the DfID did not listen to people with experience of the ground reality of the situation.”


Neutralising resistance

While most of the DfID’s money goes through the Indian government, some of it also goes through NGO’s and the ‘third sector’. And it is this funding that is the focus of the last part of the series.

The DfID has funded a range of NGO’s and organisations through its Poorest Areas Civil Society programme, which the department claims has promoted “greater realisation of citizens’ rights and entitlements.” There is an increasing body of evidence that this funding is depoliticising groups and making them more pliant in the face of western corporate encroachment, as they become dependent on funding that prevents them from taking ‘controversial’ positions. Roma, a member of a non-funded people’s movement argues:

“Groups should not take their funding. Women have re-taken thousands of acres of land without any funding… if we take this money, we will lose this agenda and sit in air conditioned rooms talking big about poverty. There are resources within the people. We got our independence and there was no funding agency; there was no DfID!”

In addition to this, the DfID funds so-called third sector partnerships to promote sustainable enterprise. This short film looks at the Business Partners for Development project in the Sarshatali area of West Bengal. NGO’s chosen and funded by the DfID were hired to tell people who lived in the area that, if they sold their lands to the Integrated Coal Mining Limited company, they would be rehabilitated and jobs would be provided. Ten years later, people are sick from the pollution caused by the mine and displaced from their lands; the promised hospital has not materialised and the few that were given jobs in the mine are fighting for tolerable conditions and acceptable pay. Swaraj Das, the secretary of the union set up for the people affected by the mine, tells us:

“We want to tell the British people that the tax that they are giving to the DfID and other such organisations for the development of poor countries like India is being given for the company. No money has been spent on the rehabilitation of the people. When the money is not reaching us at all, none of us can use even a single penny of that money, so it has no value to us.”

In response to a Freedom of Information request about the success of the project, the DfID told us that “a replicable model was developed.”


Quit India

It is true that New Labour has given more foreign aid than any other British government, but the key question is not how much it is spending but what it is spending it on. Just as New Labour’s reform of public services in the UK has not been compromised by lack of funds but by an ethos of commercialisation and privatisation, effected by a bureaucratic, centralist state, so the ability of the aid to live up to the claims made for it has been ring-fenced by policies that put profits for some over the well-being of the majority; policies that are carried out with little concern for the views of those affected.

This has been challenged throughout India, though. The DfID’s and the World Bank’s influence provoked a Campaign against Destructive Economic Reforms in Orissa, while people’s movements such as the Jagrit Dalit Adivasi Sangathan challenge projects like the Madhya Pradesh Rural Livelihoods Project as an everyday part of their struggle. The electricity supply in Madhya Pradesh was eventually not privatised following resistance by the employees’ union and a mass mobilization of people throughout the state.

More action is needed from the UK in solidarity with these struggles. This series is an attempt to encourage the view that development aid and the DfID are not counterpoints to the British state’s foreign policy but an intrinsic part of it and one to be opposed accordingly. As Bijay Pandey puts it,

“The British people should ask questions of the DfID; they should expose their dark deeds. They should be put on trial before the UK people, who should see that all the external agencies are involved in dirty tricks.” See also:

Dodgy Development: Films and interviews challenging British aid in India

Dodgy Development VI: False promises June 25th, 2010

Dodgy Development V: Power to the people? May 05, 2010

Dodgy Development IV: ‘A DFID colony’ May 05, 2010

Dodgy Development III: A DFID Education April 09, 2010

Dodgy Development II: Smile for the camera February 25, 2010