India raises Sri Lanka assistance to INR 4 b in 2026-27 Budget

Monday, 2 February 2026 00:30 - - {{hitsCtrl.values.hits}}

Indian Prime Minister

Narendra Modi

Allocation increased from INR 3 b in revised 2025-26 Budget
Sri Lanka among larger bilateral aid recipients in India’s neighbourhood
Bhutan, Nepal and Maldives remain top beneficiaries
Overall external assistance envelope broadly steady

India has increased budgetary assistance to Sri Lanka to INR 4 billion ($ 43.6 million) in its 2026-27 Budget, up from INR 3 billion ($ 32.7 million) in the revised estimates for 2025-26.

According to the Notes on Demands for Grants of the External Affairs Ministry, actual Indian assistance to Sri Lanka amounted to INR 3.17 billion ($ 34.6 million) in 2024-25, before being budgeted and revised at INR 3 billion in 2025-26. The 2026-27 allocation represents an increase of around 33% year-on-year.

Sri Lanka’s higher allocation comes within a largely unchanged regional assistance framework. Total Indian aid to foreign countries has been budgeted at INR 56.86 billion ($ 620.1 million) for 2026-27, compared to INR 57.84 billion ($ 631.0 million) in the revised estimates for 2025-26.

Bhutan remains the single largest recipient of Indian assistance, with an allocation of INR 22.89 billion ($ 249.7 million) in 2026-27. Nepal has been allocated INR 8 billion ($ 87.3 million), while the Maldives is set to receive INR 5.5 billion ($ 60.0 million). Sri Lanka’s allocation places it among India’s more significant bilateral aid partners in the region.

Overall expenditure of the External Affairs Ministry has been increased to INR 221.19 billion ($ 2.41 billion) for 2026-27, compared to INR 217.43 billion ($ 2.37 billion) in the revised estimates for 2025-26.