INDIA: Foreign aid when the problem is government failure

“In the past, there has been an alignment between the wishes of the Indian government and those of the aid donors: both wanted to correct market failures. More recently, though, another set of problems is confronting development: government failures. A classic example is the high degree of absenteeism among teachers (25 percent) or doctors (40 percent) in Indian public primary schools and primary health centers, respectively. Now the preferences of the aid donor and government may not be so well-aligned.

The donor would like to see better education and health outcomes, including less absenteeism among service providers.  Even if there are people in government who would like to see this, the absentee teachers and doctors are also public servants, and in some cases can be quite powerful politically. In such a situation, what is the role of aid? Correcting government failure is deeply political (these failures didn’t occur by accident), so aid donors can’t ‘demand’ that they be corrected (even though sometimes they try!).”

Full story:

Source: Shanta http://endpovertyinsouthasia.worldbank.org/foreign-aid-when-problem-government-failure

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3 Comments

Filed under Aid, India

3 responses to “INDIA: Foreign aid when the problem is government failure

  1. Anthony Rogers

    Is India giving foreign aid to any other countries? What percentage of the Indian budget goes to social welfare services for the poor? Is it true that the Indian government just sent people into space? What is the attitude of the Indian voters toward social services for poor people? Are these fair questions?

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