Andrew Mitchell, the international development secretary, has redesigned Britain’s £280m a year aid programme in India to give it the characteristics of a sovereign wealth fund that will bring returns to UK taxpayers.
“As far as the British taxpayer is concerned this is returnable capital,” Mr Mitchell said. “It’s hugely in our national interest because this is going to be one of the biggest markets in the world in the next few years and we have a very close partnership,” he said.
The stated aim is to lift millions of Indians out of poverty without making a loss, ensuring delivery of jobs, products and basic services to the poor.
Will it work? No solution to unemployment in Britain has been found – or sought?
Mr Mitchell hopes that the programme will also help reinstate the discredited Commonwealth Development Corporation (CDC), the UK government’s privatised development finance institution which has gone through a “bracing and bruising period” in recent months after losing its way as a private equity investor.
A rehabilitation project for CDC ?
A parliamentary report followed a 2010 review of all aspects of CDC’s work and revelations – following a Freedom of Information request – about its executives’ lavishly expensive lifestyles and CDC’s chief executive, who had supplemented his year’s salary and bonuses of £970,000 with £7414 expenses. The report was published in July 2011.
The most serious charge reported, however, was that CDC has betrayed its original mandate of poverty reduction by now focusing on lucrative projects that are designed to generate high returns for investors rather than any benefits for poor communities in the global south.
It advocated change because, it politely said, the CDC had “become less directly engaged in serving the needs of development” . . . A new chief executive has been appointed on a far more modest salary.
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