India Halves Aid to Bangladesh Amid Diplomatic Strain, Yunus's Pakistan Pivot

• India has cut its budgetary allocation for Bangladesh by 50% in the Union Budget 2026-27, from Rs 120 crore to Rs 60 crore.
• The aid cut coincides with rising attacks on minorities in Bangladesh and growing diplomatic friction between Delhi and Dhaka.
• Bangladesh, under the Yunus administration, has been strengthening ties with Pakistan, including visa-free entry, revived economic commissions, direct cargo ships, and planned direct flights.
• India's Ministry of External Affairs has consistently raised concerns about the safety of minorities in Bangladesh, with PM Modi discussing it with Muhammad Yunus.
• For the first time, India has not allocated funds for the Chabahar port project, a strategic response to renewed US sanctions on Iran, while Bhutan remains India's top aid recipient.

Why It Matters: India significantly reduced aid to Bangladesh due to strained ties, minority attacks, and Bangladesh's closer alignment with Pakistan.