USAID shuts down operations in India: Major blow to health, development projects

US Agency for International Development (USAID) has issued a directive suspending its funding for all projects in India until further notice, following an executive order from President Donald Trump aimed at reviewing US foreign assistance.

The suspension has raised concerns among organizations reliant on USAID support, particularly in sectors such as health, education, gender, and climate change, Caliber.Az reports via foreign media.

Health-related programmes are expected to be the most affected, as USAID funds have long provided critical technical support to grassroots initiatives. Despite USAID’s relatively small footprint in India, the timing of the suspension is significant, coming as global aid has dwindled, exacerbating financial challenges for NGOs already facing a decline in international donations.

The directive requires partner organizations, including voluntary groups and agencies managing government-backed projects, to reduce their expenditure during this pause. USAID’s notice to recipients emphasized that no work should resume until written confirmation is received from the agency. Sources within the development sector indicated that the suspension will be reviewed over a 90-day period.

One anonymous development practitioner remarked that while the uncertainty has caused panic, their organization remains operational, as they have other donors to rely on. Since 2004, USAID has been involved in supporting maternal and child health initiatives in India, focusing on improving healthcare services in six states, as well as advancing safe drinking water, sanitation, and hygiene in multiple cities. The agency has also worked to prevent gender-based violence and assist the disabled community in partnership with local governments and private agencies.

However, the suspension of USAID funding is part of a broader global trend, with major aid agencies from Sweden, Germany, and the UK also scaling back their support. Harsh Jaitli, CEO of Voluntary Action Network India, a coalition of 600 civil society organizations, confirmed that the decline in global aid has placed additional strain on the sector.

Smaller grassroots organizations have largely remained unaffected by the suspension, as USAID’s support has primarily been directed towards large-scale programmes, such as those addressing tuberculosis and water, sanitation, and hygiene (WASH).

Despite this, development professionals warn that the ongoing reduction in global aid, combined with stricter regulations on foreign contributions, could have long-term implications for India’s civil society.

By Aghakazim Guliyev