Thursday 28 June 2007
[Mr. Greg Pope in the Chair]
India Country Assistance Plan
Motion made, and Question proposed, That the sitting be now adjourned.—[Tony Cunningham.]
I am grateful to Mr. Speaker for selecting the subject of our future aid programme to India for consideration today. As hon. Members know, India is a great nation, rich in history. The world’s largest democracy, it has strong economic growth and understandable ambitions, which we support, for a seat on the UN Security Council. However, despite its progress, the country is still scarred by terrible levels of poverty.
Although it is often poverty in Africa that makes the headlines, and with good cause, poverty in India is also stark. Let us consider some comparative figures. Some 30 per cent. of children under five years old in sub-Saharan Africa were underweight in the five years up to 2005; the figure for India was 50 per cent. In 2003, some 320 million people in sub-Saharan Africa were living on less than a dollar a day; in India two years ago more than 350 million people were in that position, and a further 500 million people live on between $1 and $2 a day. Despite its image, India is still a low-income country, yet on a per capita basis, India receives little aid from the rest of the world. Total aid to all sources is only the equivalent of $1.50 a head, which is very low compared with other aid-recipient countries. On average, low-income countries receive about $17 a head in aid and middle-income countries just $15 a head, but, as I said, India receives just $1.50 a head.
The Government of India are committed to reducing poverty, and I wish to put on the record my appreciation of the strength of leadership in that area from Prime Minister Manmohan Singh and Finance Minister Chidambaram. India continues to welcome funding and dialogue from international donors and the UK accounts for about a quarter of all aid to India. Our combined financial and technical assistance allows us to play a key role in supporting India in its large health and education programmes and in its efforts to generate income and jobs. The job of being the UK Minister responsible for promoting development in India, which is by some way our largest country programme, is a privilege because India is a remarkable nation of myriad landscapes, cultures, traditions, languages and people. It is an extraordinary place.
In two months’ time, all those different traditions will come together to celebrate the 60th anniversary of India’s independence. As the Government, we look forward to joining in those celebrations and, in so doing, recognising a relationship between our two countries that runs far deeper than the many treaties and summits that we have signed and taken part in with the Indian Government. There is a shared history, and a shared set of values and institutions. There is also a rich cultural exchange that has produced arguably some of the great literature, music and architecture of the last century. It is a relationship of interdependence, which, I suggest to hon. Members, means that we have a responsibility to do something about the poverty, injustice and inequality that still faces much of modern India.
Will the Minister refer to the Government’s approach to the problem of discrimination by caste and descent—in other words, the treatment of Dalit peoples in India? What influence can the British Government bring to bear on the disgraceful situation that faces 200 million people around the world, the majority of whom are in India?
I recognise that my hon. Friend has been a great champion of the need to do more to support Dalits’ aspirations to be part of the success of modern India. If he bears with me, I will come to that later in my speech.
When I was last in India in January with our new Prime Minister, it was impossible to miss the jarring contrasts that it presents. On the one hand, there is a vibrant hi-tech sector that services global businesses and, on the other, there are vast numbers of landless people in rural areas who have hardly enough to eat. India is home to world-class universities, but struggles to get all children into primary school. There are luxurious hospitals for medical tourists, yet half of women in India still give birth without a midwife.
That is a side of India that many forget or simply do not see. Our TV screens and newspapers are, perhaps understandably, awash with India’s many successes. However, I suggest to hon. Members that it is our responsibility not to forget that India is also home to more than 350 million poor people, which is more than five times the size of the entire UK population and represents one in three of all the poor people in the world. People live in misery and have to scrape some kind of survival from one day to the next.
The broader truth that the international community also needs to recognise is that the millennium development goals to which all parties in the House subscribe will simply not be achieved without more progress in India. Given India’s size and the uneven progress that I have described, it is a particularly complex country for donor agencies to engage with.
I welcome the changes to the machinery of government that have been made today, as they mean that trade policy is now shared between the Department for International Development and the new Department for Business, Enterprise and Regulatory Reform. In that context, will the Minister address the important role that fair trade can play in the development of India and the alleviation of the poverty that he has described?
I will digress at this point to answer the hon. Gentleman. India has a crucial role in the current Doha round of world trade talks. Through work that we have funded with the United Nations Conference on Trade and Development—a key UN agency that works on trade issues—we have supported some of the research that India has wanted to do to understand the implications of particular negotiating positions that it might present as part of those trade talks. That is an issue on which we will continue to engage with India, because it is significant not only to India’s population, but to India’s position on the talks in relation to the many poor people in other countries.
There are, broadly, three Indias that we need to acknowledge as part of our future aid programme and three different types of development challenge. First, there is global India where people participate in a dynamic economy, are often connected to the rest of the world and enjoy comfortable incomes. Relatively speaking, that India consists of a fortunate few. The challenge there is how to work with India on some of the big global development issues such as the Doha round, as the hon. Gentleman made clear, and on issues such as climate change and access to medicines, where India’s actions and views matter for its own poor and for the poor in other countries.
Secondly, there is developing India, where people still live close to or below the poverty line, but for whom there are options and the possibility of links to the growing economy. There, the development challenge is how to work to drive better links to economic success, improve access to public services and tackle the governance challenges that have perhaps held back some parts of India from enjoying the same success as those who can be counted as part of global India.
Finally, the third and greatest challenge is poor India, where people struggle to survive from day to day and have no obvious way out. Their plight is made worse because they are often the same people who are shunned on the basis of their ethnicity or caste, as my hon. Friend the Member for Islington, North (Jeremy Corbyn) made clear.
I suggest to the House that in looking forward, we need to continue to engage with all three Indias and to work with our partners in the donor community behind India’s own development priorities. We have achieved a great deal in the past five years through the £1 billion of aid that we have delivered.
I welcome the Minister’s comments on discrimination. I am sure that he is aware of the Ambedkar principles on investment strategies in India, to which a number of British companies have voluntarily agreed. He will be aware also that many people who suffer discrimination have no real recourse to law in India because of the lack of infrastructure for them to do so. Are our development plans related to those problems?
Indeed. I commend those principles and the companies that have signed up to them and I am grateful to my hon. Friend for the opportunity to encourage more companies to do the same. We engage with businesses and want them to be socially responsible; signing up to those principles and putting them into practice is a further demonstration of that point.
I was mentioning briefly progress made as a result of our aid over the last five years. Polio is close to being eradicated in India. Each year, partly as a result of our aid, some 1 million fewer women and infant children die. More than 5 million people living in the slums of Calcutta and other major cities in India now have access to water and sanitation and other services. Indeed, our slum upgrading programmes are being used as a model by the federal Government across India. Some 7 million people, mainly women, have been given the finance that they need to kick-start their own businesses, and there are some 15 million more children in school today than there were three years ago, again, in no inconsiderable part thanks to our aid programmes. Those are significant results and a powerful demonstration of the effectiveness of aid in general, and British aid in particular.
We cannot afford to relax, however, and challenges remain: to improve the quality of education by, for example, ensuring that more children complete their education; to work towards eradicating the invisible barriers that mean that a young Muslim girl or young Dalit boy have less chance than their peers of receiving a decent education; and to work to secure a better health service and to drive down still further maternal and infant mortality rates. After all, how is it still possible that half of India’s children are undernourished, or that every five minutes a woman dies giving birth because she has no medical help?
Thankfully, HIV numbers might turn out to be lower than previously estimated, but we know from experience elsewhere that this is the moment in a burgeoning epidemic when decisive intervention can make a real difference. We recognise that now is the time to support the Indian Government’s efforts to close down the possibility of a full-blown epidemic. Clearly, we must keep pushing the international community to act on polio, because although it is contained, there are seasonal outbreaks in poverty-stricken areas, which means that we have not yet gone far enough. India’s eradication of the virus would benefit not just its own people, but the world. We are close, but have not yet completely succeeded in meeting that challenge.
Tuberculosis—a menace across the globe—thrives in a country where millions of people still live in squalid slums and cram on to packed trains in search of work. Treatment is available, but we need to increase access to it to prevent the 370,000 deaths that result every year in India from the disease. Again, we propose to continue to support the Indian Government’s nationwide diagnosis and treatment programme.
As my hon. Friend the Member for Islington, North made clear, certain groups face discrimination and exclusion. Women are usually worse off and despite India’s vast affirmative action programme, which I commend, lower caste and tribal people suffer still from marked discrimination and deprivation. A recent report by the Indian Government drew attention to the unequal opportunities for many of India’s 150 million Muslims. Some 20 million severely disabled people face enormous challenges in accessing public services and the sorts of incomes that we want them to have. The Indian Government have welcomed our continuing support—not only our money, but our style of working—in providing Government partners with the resources that they need to tackle their priorities. Those priorities are inevitably about meeting the most basic needs of the Indian people, giving them the opportunity to learn and a fighting chance when sickness strikes.
That is why I was pleased to announce earlier this month that we will spend an additional £250 million on a series of new health initiatives across India over the next five years and a further £35 million for the expansion of the Indian Government’s highly successful programme for the empowerment of women through education. I draw hon. Members’ attention also to the announcement by our new Prime Minister back in January of a further £200 million of assistance for investment in primary education.
Against that backdrop of renewed commitment to basic services for today’s most needy, and in looking ahead to the India that we want to see in 2015, we will ask those in India and in the UK who know about India—civil society groups such as Oxfam and Indian non-governmental organisations—as well as other donors, for their views on questions such as how to ensure that India’s phenomenal growth is shared by all of its citizens; how to help slum dwellers have a say in the quality of services that they receive, or, too often, do not receive; how to tackle India’s appalling under-nutrition rates, and what can be done on issues of global significance affecting the poor, such as climate change.
As part of that consultation exercise, we will ask also how we should provide aid. We have a substantial £27 million programme—the poorest areas civil society programme—that channels support directly to Indian NGOs and community organisations to help people to access Government programmes, the benefits of which, of course, are theirs by right. That programme operates in 100 of India’s poorest districts and has helped people to claim their entitlements to food and employment programmes.
I was pleased to be at the launch of the consultation process a few weeks ago. The figures that the Minister is announcing for these new programmes are very impressive indeed. On the health initiative, will the money be focused primarily on the sorts of killer diseases that he mentioned, such as AIDS and, more likely, TB, or on local work in the villages and slum communities—at a real grass-roots level—to reach the very poorest people?
My hon. Friend makes a good point: too often, large amounts of donor assistance go towards particular diseases, as opposed to building up the health system more generally. We hope that our aid will do both and enable us to tackle killer diseases such as AIDS, TB and malaria, as well as to strengthen health systems more generally, because without doing that we cannot reduce infant and maternal mortality rates.
Furthermore, we are starting a £20 million programme, channelled through international NGOs, that will work with the most socially excluded groups to advocate on their behalf and to ensure that Dalits, Adivasis and other minority groups can participate in India’s growing economy as well. Most of our aid, however, is channelled through Government systems, both centrally and at state level—in Andhra Pradesh, Madhya Pradesh, Orissa and West Bengal—because we recognise that the Indian Government are responsible for ensuring access to basic services and fostering the right environment for improving people’s incomes. Only the Government can enable the supply of services on the vast scale required. We believe that our job is to support them in that endeavour and, in that way, to help India progress towards the millennium development goals.
I support the direct aid for national and state government in India and all the other aid programmes. The Minister mentioned the problems with discrimination. Has he been assured by the relevant recipients of aid and aid programmes that they will not allow any discrimination on the basis of caste, descent or anything else when the British aid is disbursed to particular education or health projects?
My hon. Friend raises an important question about tracking aid to ensure that it gets to where we want it. For the national aid programmes, we have a series of targets and indicators that are monitored twice a year. He will be pleased to hear that one target, particularly for our education programme, involves the extent to which socially excluded groups such as Dalits—a particular concern of his—are reached. We also have a poorest areas programme, which targets the areas of most need.
Our analysis of the government system in India is that there is a positive trend in the development of the Government’s capacity to deliver basic services but, as the Government of India recognise, a huge amount remains to be achieved.
Almost since 1948 and the inception of the national health service in this country, it has been immensely fortunate in attracting a huge number of Indian doctors and health professionals. Every single person who values the NHS values the contribution of doctors and health professionals from south Asia. However, is my hon. Friend the Minister comfortable with the problem that may exist in some areas whereby doctors are trained and graduate in India but then leave the country? Does his brief include working with federal, state and national agencies to ensure that there is not a skills deficit in India because of our needs, and perhaps the needs of the west?
My hon. Friend is right to draw attention to the skills deficit in many parts of India in respect of health care. One aspect of the role that our technical assistance advisers play in health involves helping the Government to ensure that they are clear about their human resources needs—that they are examining how many nurses and doctors they need and that they have the right training programmes in place.
More generally, my hon. Friend draws the attention of the Chamber to the fact that there is a problem internationally whereby developing countries too often see their nurses and doctors poached by developed countries. Thanks to the agreement that we have in the UK, poaching by the NHS or by private recruitment agencies that serve the NHS has stopped. We are seeking to encourage other countries in Europe and around the world to develop similar codes of conduct. That is being debated in the European Union and we hope that we will secure agreement on it later this year.
I give way first to my hon. Friend the Member for Ealing, North (Stephen Pound).
I am extremely grateful to my hon. Friend for answering my question extremely comprehensively and I do not wish to divert the Chamber from the main subject of today’s debate, but has the Department for International Development received from Indian doctors or nurses or their representatives any representation expressing concern about the current changes in immigration rules, which will certainly have an impact in this respect?
I know that there is concern more generally, and we continue to explore these issues. I was remiss in not joining my hon. Friend in paying tribute to the considerable talents of those of Indian origin who work in our public services and, in particular, in our health services. My own constituents, like his, benefit from that commitment.
I wanted to raise a similar point. No doubt my hon. Friend the Minister, because he has a large Indian community in his constituency, as I have in mine, has received representations about the changes in the immigration rules, which have affected trainee doctors in particular. The issue cuts both ways. It is our responsibility to help to train doctors who may ultimately return to the subcontinent to work on the type of projects that he is talking about. Has his Department had discussions with the Home Office about the changes? Will there be any light at the end of the tunnel for those who have been caught, in particular in the transitional period?
My hon. Friend draws attention to an issue that I think will become increasingly important internationally—global migration. There is increasing dialogue internationally on that issue, in which we participate along with colleagues in the Home Office, considering not only short-term issues and immediate concerns, such as the ones that he describes, but longer-term trends. With the rise in the world’s population, India will have a very sizeable increase in population. It is clear that migration is likely to increase.
We recognise that we cannot be everywhere but, depending on the outcomes of the consultation, we will need over time to drill down to the very poorest districts in India in providing aid and support. In the short term, that means building on the early successes that we have witnessed in Orissa and Madhya Pradesh by slowly introducing more funding to those deprived states. For example, our new rural livelihoods programme for Madhya Pradesh means that we will be able to provide £45 million of assistance to lift remote tribal communities out of the spiral of poverty. It also means designing a brand new programme for Bihar—a state that is in desperate need, although traditionally it has been unattractive to donors because of its record on corruption and crime. There is now in Bihar a state government that is demonstrating a growing commitment to development and to addressing the needs of its people. We are working on a partnership with the government of Bihar, the World Bank and the Asian Development Bank.
We hope in the future to find a way to work at state level in Uttar Pradesh, which is the state with the largest number of poor people in India—50 million people. Less than two months ago, the world witnessed a major political upset as a party led by a Dalit woman swept to a convincing victory in the state elections. We will watch how the new administration settles in and develops, because if we can continue to develop confidence in the work of that administration, we can potentially work alongside it to help to tackle poverty in Uttar Pradesh.
India has growing global significance, and not only for its economic and political clout.
I apologise for interrupting my hon. Friend, but he mentioned those states in which he hopes that his Department will be more active in the future. I think that every single person in the House would applaud his plans for Bihar. Has he given any thought to working in Jammu and Kashmir? That is an area where traditionally there have been difficulties, albeit perhaps not quite as terrifying as the Naxalite presence in Bihar, where my hon. Friend is well aware of the difficulties. Might DFID feasibly work in Jammu and Kashmir in the future?
We liaise closely with the Government of India, and the states in which they want us to work are the states that I have identified. I should make it clear to my hon. Friend that we do not only have the state-level programmes that I am describing; we also work at federal level, trying to make the Government of India’s own health and education programmes more effective across the whole of India. In that way, our support for education and health should help to catalyse better support for the poorest people in Jammu and Kashmir and in states such as Gujarat, which I know is also of concern to my hon. Friend and, indeed, many of my constituents.
As I was saying, India has growing global significance, not least because of its potential importance on issues such as climate change and access to medicines. On climate change, our primary concern is to help to protect India’s 30 million vulnerable people from the adverse effects that climate change is already having, which include floods, drought and other natural disasters. All our rural programmes are designed with that guiding principle in mind. That is why we are designing a £12 million climate change innovation programme to pilot new ways of helping the poor to respond to climate change. In that respect, collaboration with Whitehall colleagues is essential, and we are working with the Foreign Office, the Department for Environment, Food and Rural Affairs and the Treasury. We are committed to working across Government not only on climate change, but on issues such as access to medicines.
I believe that British aid has had a profound impact already on the poorest people in India—I believe that it has achieved strong results. However, we cannot afford to grow complacent, because new challenges face India. We have launched a consultation document on the future of our aid programme, and I welcome the opportunity that Mr. Speaker has provided today to hear the views of hon. Members on how we should help India to move forward.
I am delighted to see the Minister in his place. I hope that the debate is not keeping him away from his telephone; I am sure that his pager is firmly switched on.
The Opposition take very seriously the importance and significance of the relationship between the UK and India. That was clearly evidenced by the recent visit to India of my right hon. Friend the Member for Witney (Mr. Cameron), the leader of the Conservative party, and my hon. Friend the Member for Tatton (Mr. Osborne), the shadow Chancellor. They went to India to understand in more detail the relationship between our two historic nations and to put on record their firm commitment to enhancing it.
The Minister was absolutely right to point out that India is the world’s largest democracy. It has made significant economic and political progress in recent years, and we in the UK should welcome that. I very much hope that there will be further significant co-operation not only in relation to the Department for International Development and the country assistance plan, but on such significant issues as terrorism, energy co-operation and environmental sustainability, which the Minister mentioned. I shall return to that issue if there is time.
DFID has published a consultation paper, and I hope that there will be significant input into the consultation not only from Members of this House, but from the wider international development community. The Minister is right to point out the economic growth that India is going through—an increase in gross domestic product of roughly 8 or 9 per cent. per annum—but a significant proportion of Indians are being left behind by that economic miracle. The three categories in the consultation document—global India, developing India and poorest India—provide a structured way of synthesising the issues and the potential solutions that have to be evaluated. There are enormous inequalities, and it is absolutely right that DFID’s long-term aim in India is, as it should be elsewhere, to move toward contributing to dialogue and technical expertise, rather than just giving financial assistance.
The interrelationship between our two countries is becoming more entwined, particularly in the economic and trading fields. Almost 50 Indian companies have been floated on the London stock exchanges, and last year, for the first time, more money was invested into the UK by Indian companies than the other way around—by UK companies into India. Some 400,000 people from the UK visit India every year, and more British tourists go to India than to any other country. More than 1.3 million people living in the UK originate from the Indian subcontinent, and those people have made an enormous and significant contribution to the UK not only in the national health service, which has been mentioned, but in business and by using their entrepreneurial flair.
The Minister was right to highlight that despite the economic growth, significant numbers of Indians still live in abject poverty. There are 300 million Indians living on less than $1 a day and more than 500 million living on less than $2 a day. Some 47 per cent. of children in India are malnourished, and every year, 1 million females and children die due to lack of health care. Only 30 per cent.—when I say “only”, I mean it comparatively—of children in sub-Saharan Africa are underweight, compared with 50 per cent. in India. Those figures start to deconstruct the argument that India should now be in a position to facilitate and enable the alleviation of poverty without outside help, which some have made. I do not agree, and we certainly want to play a significant role in helping India to build its governmental capacity by giving financial and technical support.
On malnourishment and malnutrition, does my hon. Friend agree that one of the great scandals in India is the huge proportion of its agricultural product that does not reach its market and goes to waste? Does he agree also that British companies, particularly logistics companies and retailers, have a lot to give to India to ensure that that dreadful waste of food is discontinued?
My hon. Friend is absolutely right. He has an intricate personal knowledge of India. Not only is there significant wastage of food there, but there are still barriers between states to the free transportation of agricultural produce, which, of course, hinders the free market and creates a false value in agricultural products, which is part of the problem that my hon. Friend highlighted.
As the Minister said, DFID has made a significant contribution to India. Other organisations have also made a significant input. About five years ago, India harmonised the donor community to enable it to co-ordinate more effectively and efficiently those donors and what the money is spent on. There is a lesson there for other parts of the developing world. I am pleased to see the Minister nodding. So, there are other significant contributors to the alleviation of poverty in India, namely multilateral institutions, such as the World Bank, which contributes mainly to transport and agricultural projects, and currently has 56 active projects. The Asian Development Bank is another contributor that has traditionally focused on infrastructure.
In his speech about India the other day, the Minister acknowledged that DFID is not particularly engaged in infrastructure. However, given that it is so intricately intertwined with economic growth, the alleviation of poverty and the removal of supply-side constraints, particularly in the rural parts of India where most of the poverty lies, there has to be co-ordination and co-operation between DFID and the multilateral institutions that are pumping large sums of money into the Indian infrastructure.
The hon. Gentleman will acknowledge that the worst poverty in India is often among the day labourers and landless people in the rural areas. I am sure that he welcomes the law that the Indian Government introduced to guarantee a number of days’ work each year for all landless people, which lifts some of them out of poverty. Does he recognise that the issues of access to productive land and of land ownership are absolutely crucial to the alleviation of poverty among the poorest people who live in remote villages?
I am grateful for the hon. Gentleman’s intervention. He is absolutely right to say that the national rural employment guarantee scheme that the Government recently introduced, despite criticisms that it might be unworkable and too expensive, could make a significant contribution to guaranteeing work and a minimum income to many individuals, so that they can provide for their families. He is also right to highlight the issue of land ownership. Has he read Hernando de Soto’s book about wealth creation and the way in which capitalism was generated by land ownership, which enabled land to be used as collateral to borrow money from banks as seed corn to help their businesses to grow or to move enterprises from being small to medium and, ultimately, to being large? If he has not read it, I suggest that he does, although I am not sure whether he would agree with it.
I have not quite finished Adam Smith, so perhaps I shall move on to that book later. The hon. Gentleman raises some fairly fundamental issues, such as the promotion of co-operatives and giving access to land. Giving all workers access to productive land is probably likely to lead to greater success than lecturing the landless people of India on the benefits of rampant capitalism. I do not know whether the Conservative party currently stands for rampant capitalism or whether it has moved on a bit, but it is important to have co-operatives, co-operation and community values, which is why I drew attention to the minimum work guarantee that has been produced by the Indian federal Government.
The hon. Gentleman is being slightly unfair.
He is being unusually unfair for him. He makes a reasonable point about people having access to land of reasonable quality, which ties in with his earlier point about the discrimination against the many vulnerable groups who are not allowed access to such land. Nevertheless, there is also an opportunity to have a greater spread of land ownership in rural India, which would enable small farmers to act as co-operatives, to work individually, with their families around them, or to combine those ways of working, to enable them to have some stake in their own communities and societies. That would go a long way to removing much of the discrimination in some parts of India.
I understand, although I am happy to be corrected, that one problem is the fragmentation of land ownership in much of rural India. The co-operative route that is being advocated is therefore a way to reconcile the differences of opinion that are being moderately expressed across the Chamber.
My hon. Friend is absolutely right. I hope that he did not get the impression that there is significant disagreement on this issue. There is an alignment of views that a combination of the two factors that we are discussing might provide a solution that would go some way towards alleviating some of the poverty that exists in many parts of rural India. I want now to suggest a number of issues that the Minister and his civil servants might like to look into.
Before the hon. Gentleman moves on to those suggestions, and in the spirit of trying to bring all sides together on the question of land ownership, let me reassure him that we have rural livelihoods programmes in all the key states in which we work, including Orissa, Andhra Pradesh, Madhya Pradesh and West Bengal. Those programmes work to ensure that poor people have better access to land and, in particular, to the resources found in forests, which are often a key source of income for the poorest.
I am grateful to the Minister for that intervention.
The suggestions that I shall make need to be put in context. DFID’s contribution to India is its biggest bilateral programme, and Conservative Members acknowledge the significant contribution to progress that has been made by senior figures in the national Indian Government and by many significant figures in the regional and local governmental structures that DFID supports. Indeed, my first suggestion relates to the issue of governance.
The country assistance plan states:
“It is widely recognised that implementing governance reforms effectively is the greatest challenge in the delivery of the 10th Plan”—
a Government of India initiative. Has DFID considered helping to make progress on tackling corruption? How will it make a contribution to building up governance, particularly transparency and accountability? I am, of course, aware that some states are better than others, but governance is still a significant issue in some, although I will not mention them for the record. The Minister has not mentioned the particular state that I have in mind, but I hope that DFID will look at the issue closely.
The World Bank is particularly concerned about the issue. Indeed, it has said that it has self-regulating triggers, which means that when a particular province demonstrates better governance and is proved to have achieved greater transparency and accountability, that province can draw down more money from the World Bank. Has DFID thought about introducing similar structures to assist in the effective and efficient delivery of aid? As we all know, we are talking, ultimately, about British taxpayers’ money.
To that end, perhaps the Minister can say a little more about the monitoring mechanisms that will be put in place. How will those that have been in place for the past four or five years—particularly those used to monitor local governmental structures—be enhanced and improved? How will DFID work with the Government of India to ensure that that actually happens?
Other hon. Members have rightly mentioned the importance of the economic and trade relationship between the UK and India, but there are issues about widening trade deficits and potential inflation. Is DFID giving India any technical or advisory assistance to improve the economic system and thereby reduce risks to fiscal stability? The Department has expertise in that area. It is important that the Government of India reform India’s co-operative credit structure so that economic growth is inclusive and not confined to just one section of the population. We want the maximum number of people to benefit from India’s economic growth.
DFID’s wish to focus the majority of its resources, quite rightly, on low-income countries has resulted in tensions. Of course, it is true that India is still classified as a low-income country, and I accept that there is a debate about the exact date when it will move from being a low-income to a middle-income country, but will that be built into the consultation procedure? There is a suggestion that India’s rate of economic growth means that it may well hit MIC status by 2009 or 2010, which will be bang in the middle of the time scale for the latest consultation process.
My hon. Friend the Member for Mid-Worcestershire (Peter Luff) rightly mentioned agriculture. Two thirds of India’s population depends on rural employment for a living, but current agricultural practices are neither economically nor environmentally sustainable; yields and technological inputs are low, practices are labour intensive and irrigation needs to be significantly improved, but that is expensive and needs to be co-ordinated with water and sanitation. There is also the need to address the issue of economic diversification so that people in rural areas are not dependent solely on the vicissitudes of the agricultural market and fluctuations in agricultural production prices.
Another big issue that needs to be looked at is remittances. Two per cent. of India’s population lives abroad, and India receives $18.2 billion in formal remittances per annum, which represents 3.5 per cent. of its GDP. Remittances are many times the value of developmental assistance support, but some companies still demand large charges and commissions for transferring funds back into the country. I am sure that the Indian Government would value DFID’s expertise and input in dealing with that issue.
The Minister rightly highlighted the issues of the environment and climate change, and the problems in India have been well documented. For example, people now fly more as their affluence grows. Climate change has already had an impact, and sea level rises will impact on coastal areas in particular. In addition, the country will have to put significant adaptation mechanisms in place to minimise water scarcity. There are also the issues of changes in agricultural productivity and the salination of previously productive land. Dealing with those issues will require finance and technical assistance from the developed world, but it will have to be done in a pro-economic growth way; we must protect the environment without hindering economic success. Has DFID considered how it might help India adapt to climate change financially and technically? In particular, has it considered the issue of technology transfer and of providing technology that will enable low-carbon energy sources to help the economy grow?
Another issue that I want to raise is public services. Access to public services in India is not as limited as in many parts of sub-Saharan Africa, but the quality of services can be very limited and mixed, particularly in education. In 2001, the United Nations human development report estimated that the cost to India of the brain drain mentioned by the hon. Member for Ealing, North (Stephen Pound) is $2 billion annually, which impacts on the country’s ability to provide public services. The problem is particularly acute in the health care sector, as we have discussed, and it would be helpful if the Minister could put into the consultation process the fact that Opposition Members hang great importance on the idea that the Indian elite should make every effort to make a significant impact on public services in their country of origin. We in the UK would, of course, be delighted to train them as best we can.
We have talked about labour regulations, and the World Bank believes that better designed regulations can attract more labour-intensive investment. It is right that the Chinese economic model has been driven by inward direct foreign investment, but the situation is not quite the same in India, which needs to free up its economic base by increasing deregulation of its labour market and employment structures.
The final area that the consultation could look at relates to the issue of vulnerable groups, which was raised by the hon. Member for Islington, North (Jeremy Corbyn). Scheduled castes and tribes account for a quarter of India’s population. I have met members of those groups who have travelled to Westminster, and some of them would acknowledge that progress has been made in the past four or five years, but there is still a significant amount to do. Indeed, the report by the Select Committee on International Development concluded not that long ago that DFID had
“done little to challenge the structural inequalities built into the system”.
DFID needs to focus on that, while being sensitive and understanding the cultural issues that are often behind some of the problems for vulnerable groups. Many of the excellent microfinance and micro-insurance schemes exported from Bangladesh to India could be used with vulnerable groups and to support the national rural guarantee scheme, to which the hon. Member for Islington, North alluded.
In conclusion, I hope it has become clear that the Conservatives recognise the significance of the links between the UK and India. We want the UK Government, using UK taxpayers’ money, to make a significant contribution to sustained economic growth so that more Indians will be caught in the economic growth that is taking place, and to allow the maximum number of Indian people to benefit from the creation of open access, market access and increased trade. We want them also to increase opportunity, particularly in regard to education and health care, which many Indian people need but do not get.
I crave your indulgence, Mr. Pope. It would probably be appropriate, if not overly conventional, if you would allow me to say that exactly 24 hours ago my hon. Friend the Member for Middlesbrough, South and East Cleveland (Dr. Kumar) and I were present for the cremation service of the late Piara Singh Khabra, the former Member of Parliament for Ealing, Southall and a member of the Select Committee that shadows the Minister’s Department. I do not want to give his eulogy—that has been done elsewhere. However, it is notable that he was a strong and determined advocate of the work of the Department for International Development. He would typically have been able to speak from a position of knowledge and expertise, and above all great support of the Department, about many of the points on which we have touched this afternoon, including the delivery of food from his own state of Punjab—one of the most developed agricultural states of India, where food distribution is a major issue.
It is a considerable honour for me to follow the hon. Member for Boston and Skegness (Mark Simmonds), who knows a great deal about a subject on which most of us can hope only to realise how little we know. His contribution was articulate and well informed, and I was pleased to hear it. I want above all to mention my hon. Friend the Minister. I have met him in India and walked some of the DFID projects with him. He has for years—four in his present role, and six in previous roles—undertaken exemplary work, which I admire, and which inspires great affection and respect in many of my and his constituents. To commit in the past five years a budget of what I was going to call £1 billion—but I shall say 100 crore sterling, as we do in west London—is immensely impressive, and we are extremely grateful.
I wonder, nevertheless, whether the debate, entitled “India Country Assistance Plan” might not have been retitled. Assistance almost implies the stronger brother helping the weaker, or the stronger helping the minor partner. I should have preferred a title about an India partnership plan. Frankly, I think that we have moved on. India is now not a net recipient. In many cases it is a donor. The figures for Indian inward investment to this country climb ever higher. It is something like the third largest inward investor to this country. Partnership, rather than assistance, should be our watchword, although I do not remotely imply that there should be any major changes in the Department for International Development, whether further personnel changes or changes to its nomenclature.
As we look at India as a strategic partner and a major global power, the role of DFID has in some ways to be recalibrated. DFID currently operates in four states of India—Andhra Pradesh, Madhya Pradesh, Orissa and West Bengal—but it also has federally targeted programmes working throughout India. I want to raise with the Minister the role of India in the UK, including promulgating the role of DFID, because it is not entirely a one-way traffic. The British taxpayer is acting not, certainly, out of colonial guilt and not entirely out of fraternal feeling, but in some cases, let us be honest, out of enlightened self-interest in seeking partnership with the world’s biggest democracy, which is an emerging force for stability in a particularly unstable region—a country virtually surrounded by what some people might cruelly call failed states. It is a country that has much to teach us.
At present we are extremely fortunate in having people who will make the case for DFID in the UK. I invite the Minister to join me in praising, particularly, the work of Hindu Aid, including two people whom he knows extremely well: Ramesh Kallidai and Arjan Vekaria, who work to promote the work of DFID within the Indian population in the UK. DFID’s work will be more fully understood and more effective in country when people of Indian origin are able to make the case for DFID here in the UK, not just as part of a diaspora but within the wider community. I hope that my hon. Friend will also be prepared to join me in congratulating Sewa International, a British charity that enjoys the overwhelming support of the Indian population in Britain for its work in promoting such initiatives as the one teacher school, in which core challenges such as literacy in India are addressed on a scale not readily matched by other non-governmental organisations.
We have not touched on the matter of DFID working with NGOs, but in many ways it is an area of added value. DFID is a funder of first resort, but in many cases it is a pump primer. The unsung work of the Department for International Development, which it would be appropriate to mention this afternoon, includes developmental work that it does with NGOs in India. The Minister’s Department, acting particularly as a repository of advice, information and resource, does extraordinarily good work there, which is seldom acknowledged. I hope that the Department will continue to work with agencies such as Sewa International that have the experience required not only to help achieve the millennium development goals to which the Minister referred earlier, but to meet the transparency and compliance criteria mentioned by the hon. Member for Boston and Skegness.
On the matter of partnership—although I do not mean to rebrand the Department and move it from assistance to partnership—many of us visited Gujarat after the earthquakes and took a considerable sum of money which had been raised here. We were delighted to work with the Department and with NGOs from Oxfam to the Catholic Fund for Overseas Development, but that was all under the umbrella of Sewa International. Since its inception nearly two decades ago, the UK organisation has worked to promote public service and volunteering in Britain, in partnership with DFID. The Minister will be aware that this year Sewa International has involved the entire Hindu community in raising funds for local causes, such as Refuge and Macmillan Cancer Support.
Sitting suspended for a Division in the House.
I was talking about Sewa International’s work with organisations, such as Refuge and Macmillan Cancer Support, and on blindness, old-age-related problems, learning difficulties and conservation by providing skilled, able and willing volunteers. My point is that the Department for International Development’s work in partnership with groups such as Sewa International is seldom acknowledged, seldom appears on the balance sheet and is difficult to quantify in actuarial terms, but the tangible difference that it makes to people’s lives is beyond price. The Minister obviously has no alternative to being target-oriented and to working within the Department’s brief, but I hope that colleagues on both sides of the House recognise that there is vastly more to the Department than simply the transfer of funds.
On the sustainability of some of DFID’s projects, in which the Minister has taken a personal interest, it is a matter of some concern to those of us who are not unfamiliar with some of the donor organisations in India that schemes are often time-limited, for obvious reasons, and the sustainability element of such schemes is often overlooked. I was interested to note from the Department’s last three years’ reports that a policy seems to be emerging of taking snapshots of schemes in which DFID was involved and assessing how they stand up on their own. Is that now the Department’s policy or is it a reflection of the Minister’s deep personal commitment and serious analysis of the situation? We often think of sustainability in terms of the economy and the environment, but it is equally significant and important in terms of country assistance plans and country partnership plans.
My point above all is that DFID is doing a good job. The fact that everyone recognises that is not a reason for it not to be mentioned. The Minister is very much part of that process and he has the admiration not just of the wider community in this country, but of many people throughout the world, particularly in India.
My slight worry concerns the scheme’s future as India becomes ever richer. We are talking about a country with more than 10 per cent. GDP growth per annum. If the problems with power supply and transmission are factored in, that is geared down, but if India were able to resolve those power supply, transmission and creation problems, its GDP growth would almost certainly be around 14 per cent. or 15 per cent. per annum, which would be both stunning and staggering. Some people might ask why this country, which is admittedly immensely wealthy, should provide support through organisations such as DFID to a country with such rapid growth, and I was cheered to hear the Minister refer to islands of abject poverty in the wider sea—in India they are probably islands of affluence in a sea of poverty.
Overall, India is growing and life is slowly getting better for the majority, although there is a particular problem in rural areas. With a number of imaginative schemes, such as computers and laptops in villages, distance learning projects and health provision, the Indian Government, working with DFID, are addressing the specific issue. I implore the Minister and all my parliamentary colleagues not to think that we are at the stage at which India does not need partnership. It does. It needs assistance and it needs DFID. Equally significantly, I suggest that this country, our continent of Europe and the world need the emerging democratic superpower of India as a partner.
If one of the purposes of these debates is an examination or assessment of a Department, I would give DFID high marks in virtually every category. It could do more and it could do better, but what it is doing is of a very high standard. On behalf of my constituents and those of many other hon. Members, I thank the Minister and his Department.
I thank the Whip, the Speaker or whoever chose this subject for debate, because it is very welcome, as there are huge issues relating to India that need discussion and debate. I am sure that hon. Members will agree that it is disappointing that more colleagues are not present this afternoon when there is a huge Indian diaspora in Britain that has an enormous interest in India, which is an enormous and important country.
I have been to India a number of times. I was most recently there last year for a Mumbai peace meeting—my visit is recorded in the Register of Members’ Interests—about peace issues concerning India, which was organised by Focus on the Global South. It occurred to me during that and other visits to India that one cannot but be shocked, day in, day out, by the disparity between wealth and poverty. Mumbai is a rapidly growing city. It has fantastic affluence and wealth, and also appalling poverty alongside them. Indeed, on a previous visit to attend a World Social Forum meeting I saw in some parts of Mumbai a combination of almost feudal levels of rural poverty and the western-type problems of a post-industrial society.
The World Social Forum meeting was held at a former machine tool factory that had been closed down due to lack of orders because the work had essentially been taken over by the Chinese, who could produce identical machine tools considerably more cheaply. The paradox was a fast-growing, financially encouraged economy with a large number of highly skilled industrial workers who had been making machine tools, but were unemployed and had become hawkers on the streets. Only a few miles away there was dreadful rural poverty.
We must recall the tremendous issues faced by the state and national Government in India. As my hon. Friend the Member for Ealing, North (Stephen Pound) said, we must remember the relationship between this country and India. When I come through St. Stephen’s, I always smile at the picture of Sir Thomas Roe presenting his credentials to the Mogul emperor because the legend underneath refers to him
“laying the foundation of British influence in India”.
I am not quite sure whether the next 300 years were about British “influence” in India; they were more to do with empire and control. Some of our paintings should be slightly more honest about that relationship. We must understand both the history of India and the relationship between this country and India.
I support the aid programme for two reasons. First, it is right to do so anyway, because of the poverty in India and the blighted and wasted lives that it creates. Secondly, as a former colonial power in that country, we should do as much as we possibly can. A great deal of wealth was made for this country out of India, and the very least that we can do is assist Indian development. We should be very clear about that.
I shall re-emphasise the Minister’s earlier point by quoting from the excellent briefing that was produced for the debate, because it cites a stark figure for the proportion of the world’s poor who live in India:
“Across the world, 530,000 mothers die each year while giving birth. One in five of those deaths are in India. More than 10 million children die before the age of five every year, and one in four of all these deaths occur in India, with 1.2 million infants dying within a month of their birth.”
The millennium development goals state that we will deal with those matters by 2015. That is an enormous task, and 2015 is not that far away.
As my hon. Friend the Member for Ealing, North said, the question is about developing a partnership, as much as an aid programme, which encourages and assists the Indian health and education services to conquer those problems. The poverty in the villages is dreadful, wasteful and quite appalling. When I intervened on the hon. Member for Boston and Skegness (Mark Simmonds), I welcomed the minimum labour scheme that has been introduced to rural areas. It has made a difference, which means that some of the worst aspects of absolute poverty have been reduced, although I should not say removed.
The issues of access to land, access to markets for goods and the prices that are paid to those producers for them must be addressed. There are literally tens of thousands of farmers in rural India living in the most appalling debt, and the suicide rate among them is terrifying. In many cases they have borrowed money from unscrupulous money lenders to try to develop their farms, but have not been able to achieve the prices that they deserve for their goods and investment. They still have to pay the debt, however, and if they cannot, the bailiffs arrive and all the rest of it. Suicide is often regarded as the only way out by those people. I do not suggest that the British aid programme can solve all those problems, but I know that the Minister is well aware of the issues. The rural development programme is geared towards those people and those issues.
I intervened on the Minister about discrimination on the basis of caste and descent, about which I feel strongly. Together with my hon. Friend the Member for Wolverhampton, South-West (Rob Marris), I am involved with the International Dalit Solidarity Network. Indeed, I am the honorary chair, so I do not have to declare it because there is not any money involved. It is an effective campaign that has done a great deal to expose the issues of discrimination against caste and descent, and the sheer numbers of people who are involved.
The recent Library briefing, “A political introduction to India”, which I commend, makes the point that untouchables, as the lowest caste or the sub-caste of Dalit people are known,
“are twice as likely as other castes to work as poorly paid daily wage-labourers, twice as likely to be unemployed and twice as likely to be below the official poverty line.”
It is a perverted form of Hinduism that encourages discrimination such as the untouchability of people of the lowest caste, and it has bedevilled much of Indian politics for a long time. Mahatma Gandhi was opposed to the untouchability aspect of the caste system, and Ambedkar was the author of the Indian constitution that specifically outlawed Dalit discrimination.
The legal rights of the Dalit people exist in the law and constitution, but any form of redress clearly does not. I have discussed poverty among Dalit peoples, but the other problems that they face are violence against them, murder and death. If any Dalit tries to marry outside the caste, unfortunately in some parts of India, one or both parties to the marriage are likely to be killed. This is a brutal source of discrimination against peoples. It is up to us not to solve that issue completely, but to support the organisations that draw attention to such abuses of human rights, and to ensure that the aid programmes, about which the Minister has reassured me, support human rights, access to law and justice and a campaign to end discrimination against a people on the basis of caste and descent. What happens to them is simply wrong.
Discrimination exists in the public and private sectors. I shall deal with the public sector first. In Indian law, there are reserved places for public sector employment, and election to the Lok Sabha, the national Parliament, and state assemblies for people of the lowest caste. I understand why it has been introduced, and on one level I support it because it ensures that the Dalit people are represented. Unfortunately, however, such quotas can act as a glass ceiling, meaning that as soon as the public authority has fulfilled its obligation to employ the specified number of people, it neither goes any further nor feels the need to do so. I hope that through the Department’s aid programme for education, we will do our best to ensure that there is no discrimination concerning access to the schools that are involved in British or European aid programmes.
In the private sector, there has been a campaign for the adoption of the so-called Ambedkar principles of employment, which are non-discriminatory employment practices. When I intervened on the Minister earlier, I was again reassured by his response. Several British companies have voluntarily signed up to the principles, and the International Dalit Solidarity Network is in discussions with several of them to promote the Ambedkar principles to ensure that they do not become involved in any form of discrimination.
The other general point is that India’s economy is growing rapidly and in many ways disproportionately, and many people fall by the wayside as the juggernaut moves ahead. There are in India forces such as the trade unions and others that are trying to ensure that economic growth is more cohesive, and that attention is paid to the needs of the urban and rural poor.
However, one must ask questions about India’s level of military expenditure, which depends on its relationship with Pakistan since the foundation of both states at the time of independence. I am glad that both states now work much more closely together. The railway and bus service has reopened, and there is a degree of co-operation and good relations between both countries, but we must remember that the tension between them has provoked both into developing nuclear weapons, eating up a fantastic amount of resources that could have been used far better on education, health, water, housing and an awful lot of other things. One could make that argument almost anywhere, but it is important that we draw some attention to those issues. Security comes from conquering poverty and giving opportunities to people, not from the possession of weapons of mass destruction.
India has grown very fast, and it contains all kinds of contradictions. I assume that if such development continues, it will make a lot of sense to make India a permanent member of the UN Security Council when the final agreements are reached about the allocation of seats.
I get some indication that my hon. Friend might be coming to a conclusion. I apologise to him for intervening now and for coming late to this debate; I had an interest in the debate in the main Chamber.
Like me, my hon. Friend signed early-day motion 1330 on Afzal Guru, the individual prosecuted for the attack on the Indian Parliament, who has been sentenced to death. It has been revealed that he was tortured during his interrogation. There are now significant anxieties about the prosecution of his case, and an appeal has been made to the Indian President. One of the issues about India’s status is its relationship with human rights. Will he be raising that issue before he concludes?
I thank my hon. Friend for that intervention, and I fully understand why he has only just come to the debate. I signed that early-day motion willingly, because I believe that one should pursue cases in which there appears to have been a lack of access to proper justice. Where torture has been involved in the extraction of evidence, such evidence is certainly not admissible in courts in this country or under the European convention on human rights. The issue of discrimination based on caste and descent has been raised with the UN High Commissioner for Human Rights and now the Human Rights Council. I fully expect that that case will end up there also, because it has been taken up by a number of human rights groups.
I was making the point that I see myself as a friend and admirer of India. I find its history, its cultural diversity and all that exists within it absolutely fascinating, and I look forward to its continuing growth. However, I also look forward to the development of a strong civil society and a strong adherence to the national constitution, the principles behind the universal declaration of human rights, to which India is a signatory, and the issues addressed by the UN High Commissioner for Human Rights. We cannot be blind to human rights abuses anywhere in the world. Unfortunately, the case mentioned by my hon. Friend is not a totally isolated example of such problems, and today’s debate has given us an opportunity to talk about them.
I welcome what the Minister said in his opening remarks and the commitment that his Department has shown toward India, particularly the huge commitment to education announced earlier this year when he and the then Chancellor were in India. That is a real commitment to lifting the poorest people out of poverty. Poverty is a terrible waste of human spirit, human resources, human opportunities and human life. We should think of all the geniuses in very poor Indian villages who die before they have a chance even to receive a proper education, and all that is lost to the rest of us as a result.
We have a duty, an obligation and, I believe, a desire to continue the partnership with India to ensure the development of all the social and public services that we have talked about, and of the civic society that will protect people from human rights abuses and discrimination, which unfortunately still exist in many parts of India.
I shall restrict the majority of my comments to the India country assistance plan, but first I shall discuss a couple of the issues that have been covered.
I shall not give a description of the present situation in India; that has been described by the Minister and the Conservative shadow Minister, and particularly well by the hon. Member for Islington, North (Jeremy Corbyn), who in his usual way has blended fact and emotion to give a powerful picture of the situation. He also touched on the important issue of discrimination. In his intervention on the Minister, he used the term “tracking aid”. That is particularly important. One criticism of DFID is that it has not always been able to say exactly where its aid has gone and how effective it has been. I shall return to that point in a moment.
As well as praising the hon. Member for Islington, North, I must praise the hon. Member for Ealing, North (Stephen Pound), who made some pertinent points. He paid a moving tribute to his friend, the former Member for Ealing, Southall, and I think that we all associate ourselves with those comments. He used an important word—partnership. Perhaps he was saying partly that assistance was not the right term. In any aid programme, we should work in partnership. One of the failures of western aid, and now eastern aid as well, is that it has imposed solutions rather than working in partnership with local communities and non-governmental organisations to be most effective. That has led to a vast waste of effort and funding, which in the long term creates resistance in western countries. I praise the Government for trying to cut that down and I think that in some ways we are leading the way in making that partnership work.
I will tone down the comment that I was going to make by way of a question. If the hon. Gentleman is characterising British assistance to India or indeed to any country as top-down or imposed, I completely and utterly reject that accusation. Where we work with Governments, we work closely with them to put our aid towards their priorities under their poverty reduction strategy. I hope that he will recognise that where Governments are not committed to poverty reduction—one thinks of Burma, Zimbabwe and so on—we work in other ways, outside Government structures, with NGOs and UN organisations as he describes. I hope that he will accept that.
I do accept it and that the Government are trying to work in partnership, which is why I thought that the points made by the hon. Member for Ealing, North were particularly pertinent. But it was worth putting on the record that not all Governments do exactly as we do. Aid, particularly emergency relief aid, is sometimes wasted due to imposed solutions.
I move on to commend the Government’s work, in that it was the Labour party, during the last century and the beginning of this one, that showed a commitment to international development. The first Colonial Development Act was passed in 1929 and it was 35 years before a Minister for international development was appointed. That was Barbara Castle in 1964. It is the Labour party and Labour Governments that have maintained the independence of the Department for International Development, whereas former Conservative Governments have removed its independence and made it part of the Foreign Office. I am not too sure that the new huggy-huggy Conservatives would do the same. Perhaps the hon. Member for Boston and Skegness (Mark Simmonds) will confirm that.
It is best to put on the record that Conservatives have made a commitment that DFID will retain its independence and separation from the Foreign Office. It will also have a Secretary of State at Cabinet level after the next general election, when hopefully the Conservative party will form the Government of this country.
I also say to the hon. Gentleman that significant contributions have been made by Conservative Members of Parliament who have been Ministers for overseas development, such as Linda Chalker and Chris Patten. Indeed, John Major’s Administration initially led the debt alleviation that has now come to fruition under the heavily indebted poor countries initiative.
The hon. Gentleman has put on record the point that he wished to make. I was not trying to criticise the Conservatives too much. I recognised in my statement that they have moved on.
Following on from the intervention of the hon. Member for Boston and Skegness, it would of course be remiss to overlook the extraordinary: the signal contribution made by the hon. Member for Grantham and Stamford (Mr. Davies) as a member of the Select Committee. I am sure that the hon. Member for Teignbridge (Richard Younger-Ross) will wish to pay credit to him.
I shall leave others to have their discussions outside this Chamber afterwards if they wish.
There is concern among international aid organisations about the new Prime Minister’s talk of the home agenda. I know that he is passionate about aid to the third world, particularly Africa. I attended a Catholic Fund for Overseas Development Pope Paul VI memorial lecture across the road, at which the Prime Minister, then Chancellor of the Exchequer, spoke. He spoke particularly passionately and well—very movingly, I will say—on the need to help African nations. I hope that that commitment will not be lost in his determination to change and have an approach different from the former Prime Minister’s on foreign affairs; I hope that that commitment will continue. I am fairly sure that it will.
The hon. Member for Ealing, North said that DFID was doing a good job. By and large, we all recognise, as I have, that DFID and the Labour party do a good job, but my purpose and that of Back Benchers here today is not just to say that, but to say that the Department can do a better job and to suggest improvements.
I move on to the India country assistance plan. I understand that the budget of the aid programme for India is currently £266 million and will rise to £290 million next year. As India grows and transforms in the next five to 10 years, DFID will seek to work with the three Indias. The consultation is welcome, but there is still concern that DFID has a somewhat outdated world view. India is classified as a middle-income country. The programme supposes that poverty can be found everywhere and is not confined within state boundaries. DFID categorises poverty by country. Obviously, poverty varies across a country such as India, but an average has been calculated for all parts of India.
For the record and to help the hon. Gentleman—although why I should when he described our aid programme as outdated, I am not sure—I should say that India is not a middle-income but a low-income country. One reason why we believe that we should continue to provide substantial assistance to India is that it is one of the least aided of the family of low-income countries worldwide.
Clearly, our advisers and Government advisers have looked at different sources; the Minister has made his point.
The National Audit Office report entitled “Department for International Development: Tackling Rural Poverty in Developing Countries”, which came out in March, made it clear that the Government need to abandon their outdated view of the world. The focus should be on communities themselves rather than on individual states. Due to economic growth, many states classified as middle-income countries still have extreme poverty, often in rural areas. The report shows that DFID’s rigid view of the world does not necessarily correspond with that reality. It is therefore a welcome step for there to be focus on the three Indias, as there is in the consultation. However, how will DFID reconcile that with the fact that it still seems to focus its funding on a country-by-country basis? Nevertheless, as I said, that step is welcome.
In response to the consultation, two of the eight questions are of particular concern. How can DFID help strengthen the accountability of public services, from national down to local level, in villages and slums? How can DFID best work with other UK Government Departments to help India address climate change? That relates to the point about sustainability that was raised earlier.
The accountability of public services and true development should be handled on a local level. Local accountability will go further in tackling corruption. Donors such as the UK should therefore channel more funds through local government; that could strengthen local government and vital local democracy. Much large-scale corruption occurs through singular central elites.
Sitting suspended for a Division in the House.
Much large-scale corruption occurs through singular central elites, which leads to single tribes and ethnic groups grabbing control of the reins of central Government. One central target that holds all the power and wealth of a nation is a much greater danger than strong local government that can respond to local needs and demands. That needs to be taken further into account in the assistance plan for India. DFID is obviously considering it, as it has asked questions about it.
DFID should therefore assess all its funding in India to ensure that as much of it as possible goes through local channels. That would go some way also toward mitigating the criticism made in the NAO report, as there would be a focus on communities rather than on the state. Perhaps the Minister will pick up on that point. Decentralisation saves money as well as improving delivery. The principles of decentralisation ensure democratic accountability and a closer working relationship between the public, who are the recipients of public services, and the authorities that provide them. Access to public services was touched upon earlier in the debate.
Climate change needs to be discussed. It is a welcome step that the consultation recognises that this is not merely a development problem and that DFID needs to work with other Departments on it, but how will help on climate change be funded? It is crucial that we understand that although development assistance agencies are the institutional vehicles for delivering financial assistance for adaptation to developing countries, the additional funding should not be part of existing commitments to development under the UN 0.7 per cent. GNP target.
Recent events in India have reminded us of the impact of climate change. It is a huge threat to development, especially in less developed and middle-income countries. In the past few days the southern Indian state of Andhra Pradesh has been working to reach the villagers worst affected by the heavy rains that have made more than 200,000 people homeless. That is yet another stark reminder that climate change needs to be taken into serious consideration.
There is a case for arguing that overseas development assistance from rich countries should include support for adaptation, but the obligation on rich countries, which are responsible for 70 per cent. of all greenhouse gases currently in the atmosphere, to help poor and vulnerable countries is based not on a moral obligation to help the less well-off but on the “polluter pays” principle enshrined in the UN framework convention on climate change. We therefore need to find funding outside the 0.7 per cent. target for overseas development assistance. It is particularly important in relation to the India country assistance plan that additional funding be found from outside that for the ODA.
We need to develop a framework that allows countries to accept different commitments according to their circumstances. Like India, each country should work towards the global stabilisation of emissions, but the stringency of their commitments should depend on their economic, developmental and environmental circumstances. Industrialised countries’ emissions should be allocated on a per capita basis, whereas developing countries should take on emission limitation or carbon intensity targets, or no commitments at all, depending on their development levels, and move steadily towards more stringent commitments as their economies grow.
For that to work, our international institutions need to start taking climate change seriously. The World Bank does not do nearly enough to focus on it, the International Monetary Fund does almost nothing, and the environmental agenda has conspicuously all but disappeared from the Doha talks. Climate change needs to be incorporated into all elements of development programmes. Ensuring that development objectives fully support climate change mitigation will require co-ordinated, integrated action from the IMF, the World Bank and the Organisation for Economic Co-operation and Development.
If we do not act now, the implications for the developing world and India will be stark. We are now familiar with the concept that many small island states will simply cease to exist, submerged and rendered uninhabitable by rising sea levels and extreme weather. The implications for bigger, coastal nations are just as severe and provide another example of the governance agenda overlapping with the climate change agenda. Any country with a highly fragile political system or prone to violence and instability will simply not be able to cope with the burden of extreme flooding and storm surges. Maintaining good governance or even a functioning state apparatus will be enormously difficult. Those are challenges that we might well face in the future.
I shall try to respond to some of the points that hon. Members have raised in the debate. I join my hon. Friend the Member for Ealing, North (Stephen Pound) in paying tribute to the considerable service given by our late hon. Friend Piara Khabra, who, as he said, was a great advocate of international development and, in particular, partnership with and aid to India.
The hon. Member for Boston and Skegness (Mark Simmonds), in his traditional way, asked a series of questions and made a series of comments. I welcome the spirit in which he did so, and we shall take his ideas into account when we come to the end of the consultation period and assess where to go next.
The hon. Gentleman asked what will happen when India becomes a middle-income country, which was a reasonable question as we expect India to reach MIC status at some point between now and 2015. That is one reason why we are seeking to concentrate our assistance in the poorer states of India, which have not experienced the rates of economic growth seen in the rest of India—hence our keenness to look at Uttar Pradesh and Bihar.
The hon. Gentleman also talked about remittances, which are of considerable importance not only to India as a whole, but to the Indian diaspora in the UK community. He is right to challenge the financial services industry to consider the commission charges that it levies. We have seen evidence that for £100 sent back home to India, a commission charge of anything from £5 to £35 is levied. Given the impact that remittances make in India, such huge commission charges are inappropriate. I hope that the information leaflets and the website www.sendmoneyhome.org, which we have helped to facilitate, will give information to people of Indian origin living in the UK who want to send money home as cheaply and safely as possible. They have a right to expect us to help with that, and I hope that that information will be helpful.
That is an important point. In my constituency experience, one problem is that people who send relatively small amounts of money back home often do not speak much English, if any, and are therefore prey to people who charge incredible rates for sending small sums. It may be quite difficult to police that, but some degree of advice in local languages and, in the long run, some regulation of agencies is important.
We are continuing to work on that. I think that in the end the financial services industry will recognise the increasing sums of money that are being sent home to India and other countries and realise that it is in its own interest to provide remittance products in a way that people of Indian and other origin find useful. Acknowledging translation needs is clearly sensible, and we are beginning to see progress and recognition of that in the financial services industry, although more can be done.
The hon. Members for Boston and Skegness and for Teignbridge (Richard Younger-Ross) rightly asked about the monitoring of aid and the efforts to build up good governance. They will be interested to know that with DFID support, the government of Andhra Pradesh has established a centre for good governance to help with the reforms that it wants to make. Such has been its impact in helping to improve the government’s capacity and ability to tackle corruption that it is seen as a model for other, similar schemes across India.
The hon. Member for Boston and Skegness will remember my having mentioned the poorest areas civil society programme, which supports civil society organisations in the 100 poorest districts of India. It is designed to help the poorest people of India get access to their rights and, by definition, it holds the Government to account and in that way helps to drive better governance. He will not be surprised to learn that we focus our efforts on the governments in those states to build up their ability to put good financial management systems in place. We have seen notable improvements, particularly in Orissa.
The hon. Member for Teignbridge asked how we monitor our aid programmes. Let me briefly talk him through the process. When we design new programmes, we conduct a proper fiduciary risk assessment to analyse the quality of the financial management and, obviously, to look for any potential corruption risks. We decide how to mitigate the risks that we recognise in advance and agree an action plan with the government on how to address any corruption concerns that we might have. If alleged corruption is reported, we take swift action to work with the state government concerned to get it to respond and to take necessary actions to investigate such incidents or accusations and, if necessary, to prosecute the relevant individuals. Our own internal audit department systematically investigates each and every allegation as well.
The assistance that we give to governments does not just involve handing over money and that is the end of the story. We also provide substantial technical assistance to ensure that the money can be used effectively, and to help to ensure that the government’s own money, whether the government is state or federal, is used effectively. For example, we have a programme under way at present to help to improve reproductive and child health, and we have consultants from the Crown agents helping the federal Ministry of Health and Family Welfare to set up procurement systems, which, as a result, will help to build strong financial management systems.
As I said, DFID India in particular has an in-house procurement team that oversees all our contracting to ensure that our procedures are complied with, that value for money is secured and that the most efficient outcome is progressed. There is substantial monitoring, design work and investigation of the possibility of corruption before we commit ourselves to programmes, and then considerable monitoring throughout the course of the programmes.
The hon. Member for Boston and Skegness said that we need to recognise the impact of climate change in India and India’s role in helping the world to tackle the impact of climate change. I suspect that he is aware of the sustainable development dialogues that are joint programmes of the Department for Environment, Food and Rural Affairs, DFID, the Foreign and Commonwealth Office and the Treasury, and the major emerging powers of China, South Africa and India. In addition, we are designing a £12 million climate change adaptation programme to consider how innovative ideas might be developed to help India address the impact of climate change.
The hon. Member for Teignbridge made an argument for additional resources to tackle climate change outside the 0.7 per cent. target. I accept that argument in part, but not entirely. I accept that we will need to raise substantial additional finance beyond what the European Union and Britain have committed to date, but I think that it is the money that is generated around international carbon finance as a result of emissions trading, for example, that has the potential to provide the resources. Our climate change innovations programme in India is looking at how we can help poor people get access to international carbon finance to reduce greenhouse gases. It is not entirely right to say that no climate change programme should be counted in the 0.7 per cent. target. That misplaced comment has been made by several non-governmental organisations.
The hon. Member for Boston and Skegness asked about fiscal stability, and what we are doing to support India’s efforts in that area. In my intervention on the hon. Member for Mid-Worcestershire (Peter Luff), I mentioned the aid that we are giving through the United Nations Conference on Trade and Development. The initiative involves looking at trade issues and carrying out different pieces of analysis to help the Ministry of Industry and Commerce in India to develop its trade policy. That contributes to the broader work on fiscal stability.
My hon. Friend the Member for Ealing, North rightly highlighted the importance of partnership with India. Earlier, I discussed the three Indias that we perceive and that we have to work with. I hope he will recognise that my reference to global India in particular represents the element of partnership most strongly. India has an important role to play globally in terms of climate change, international trade and delivering access to medicines. He rightly said that we must work in partnership with India to make progress on such issues.
In terms of partnership more generally, my hon. Friend is absolutely right to highlight the importance of the inward flow of visitors, and the inward investment that comes into the UK from India and vice versa. Other Departments will take the appropriate responsibilities for that side of the partnership. He is also right to highlight the fact that India’s stability is a force for good in the region.
I say gently to my hon. Friend the Member for Islington, North (Jeremy Corbyn) that India has a right to self-defence and armed forces. The proportion of gross domestic product that it spends on military expenditure is similar to that of other low-income countries, and we particularly welcome the rising levels of social sector expenditure by the Government of Prime Minister Manmohan Singh. They are spending more on education and health, and we warmly welcome that.
My hon. Friend the Member for Ealing, North rightly highlighted the considerable contribution that Hindu Aid, and Ramesh Kallidai and Arjan Vekaria—its present leadership, for want of a better phrase—are providing. I commend their work and programmes. My hon. Friend told us about some of the work of Sewa International, in particular its leadership in motivating and galvanising the Indian community in the UK to respond to the Gujarat earthquake. It did a powerful and important job then, and its aid programmes continue to do good.
My hon. Friend asked me in an intervention what we can do to provide support to the poorest people in Jammu and Kashmir. I mentioned that we support federal programmes to provide access to education—primary education in particular—and to better health services. He will be pleased to hear that our support to the World Bank is also leading to work on agricultural livelihoods in Jammu and Kashmir.
I pay tribute to my hon. Friend the Member for Islington, North for his work with the International Dalit Solidarity Network, which does important work. We are seeing progress in terms of better services for Dalits, but obviously much more work needs to be done. Those are some of the issues that we consider as part of making progress in delivering better access to education.
In the discussion of what constituted socialism or capitalism with the hon. Member for Boston and Skegness, my hon. Friend raised the issue of co-operatives. As the chairman of the Co-operative party, I warmly welcome the increasing role that co-operatives play in the developing world. We work with co-operatives and acknowledge them to be one of the key ways to deliver inclusive economic growth. A series of our programmes involve work on that issue.
In one of his final points, the hon. Member for Boston and Skegness highlighted the importance of access to financial services. He also mentioned the lessons learned from Bangladesh, the Grameen bank, and the excellent work and leadership of Muhammad Yunus, the Nobel peace prize winner. He will be pleased to know that we are working with the Small Industries Development Bank of India to develop the capacity of microfinance institutions in India to help a range of individuals or groups. We are also giving support to the credit and saving for household enterprise project, which, again, delivers significant access to microfinance.
The hon. Member for Teignbridge asked how we monitor our programmes. All programmes must have a results framework with a set of indicators, against which we judge progress. For example, in the primary education programme, which has put some extra 15 million children into primary school in the last three years, there are targets for enrolment and for the proportion of girls and those from disadvantaged backgrounds in schools. For those who have enrolled, there are targets for measuring progress in the quality of education. Where programmes are off track to meeting those targets, at the review points that we have throughout each year we and the Government look at what else we need to do to get back on track and to resolve those off-track issues.
At the end of programmes, we look at the lessons that have been learned through an evaluation process that we have in the Department. I do not accept the suggestion made by people that we do not know where our aid money goes, that we do not monitor its effectiveness and that it does not deliver significant results. It does deliver results and the successful aid programmes highlighted in my opening speech give, I hope, confidence to the hon. Member for Teignbridge and other hon. Members that our aid to India programme makes a significant difference.
There is more that we must do, and we will look at the points that hon. Members have made as part of the consultation process. I look forward to debating these issues with hon. Members again in the future.
Question put and agreed to.
Adjourned accordingly at eight minutes to Five o’clock.