India, UK discuss 'trade-linked-aid' misgivings

Last Updated: Fri, Feb 10, 2012 06:58 hrs

New Delhi:Under the cloud of media reports that UK might choke its aid to India for choosing France to buy 126 warplanes, Union Finance Minister Pranab Mukherjee had a telephonic conversation with Andrew Mitchell, Secretary of State for International Development of UK, on Thursday to clear the air.

Much to the dismay of the UK, France-made Dassault Rafale inched closer to clinching a $15 billion Indian Air Force contest for 126 fighter jets recently, edging past rival Eurofighter Typhoon of UK.

Soon media reports circulated that UK would stop its aid to India and also quoted the latter saying the money received as aid is peanuts.

Some British MPs were critical of the aid policy in their country after the French company emerged as the front runner.

As international development secretary in David Cameron's Government, Mitchell is responsible for the 280 million-a-year aid package, British media reports said.

Earlier Mitchell had told an Indian business daily that "all UK aid, including in India, is untied from UK commercial interests".

On Thursday both the leaders- Mukherjee and Mitchell- discussed the recent media reports in UK regarding the India-UK Development Cooperation Partnership, the government here said.

The Indian government India and UK had mutually agreed in July, 2011 to continue the Bilateral Development Cooperation Programme in India till 2014-15, it said.

The same was also mentioned in the Joint Press Statement released after the visit of the Indian Finance Minister Mukherjee to UK in July, 2011 and reiterated in the Joint Press Statement issued during the visit of Andrew Mitchell to India on Dec 16, 2011.

The Finance Minister stated that India and UK share historical ties and have warm and friendly relations.

The relationship between the two countries has been strengthened further by the Indo-UK Bilateral Development Cooperation Programme which is mutually beneficial to the two countries, India said.

The two Ministers expressed satisfaction with the progress of developmental cooperation activities and also appreciated the recently introduced component of Private Sector Development initiatives through Government Sponsored Institution.

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