Despite the decision to suspend development work in both China and Russia, aid to India would continue, the Minister told delegates at a meeting at London's Chatham House. "We are not quite there yet, having discussed matters with the Government of India, even though the pace of India's transformation has been remarkable."
The UK government will maintain aid at its current level of 280 million pounds a year up until 2015.
However, the nature of the relationship would change. "We are discussing plans focused tightly on the poorest in society," he said. Going forward, private enterprise will be an increasingly significant component of the work in India. "We want to help unlock funds of the private sector," he said, adding that India's private sector miracle had not always helped the poor. Funds will be targeted at wealth creators and entrepreneurs "wiling to take risks to start and scale up private investments." The focus would be on projects targeted at women and children, and on education, healthcare and employment for the poorest.
At the centre of the work will be CDC Group, the government's development finance institution, which until recently had a low-key role. "We want to put it back into the DNA of our development work."
Full details of the plan for India will be outlined early next month when the government publishes a review of its bilateral aid programmes, including plans to suspend aid programs in a number of other countries.