Indian leaders trumpet their nation’s recent global ascendancy in a variety of ways. They highlight the importance of India’s G20 membership, claim a permanent seat on the UN Security Council, and demand India’s inclusion in what they for long, derisively, termed “cartels” like the nuclear suppliers’ group. Not least, they build gigantic, spectacular, exorbitantly expensive projects such as T-3 at Delhi airport. In line with this is their boastful aspiration to transform India from an aid recipient to a donor.

This is not quite materialising. India remains a major official development assistance (ODA) recipient and the biggest borrower of concessional finance from the World Bank. Major programmes such as the Jawaharlal Nehru National Urban Renewal Mission and various metro railways are dependent on such finance. India also continues to receive $2 billion in ODA from rich countries, especially the European Union and Japan.

Paradoxically, India first decided to reduce dependence on ODA in a fit of pique under the BJP-led government, which launched the India Development Initiative after the 2002 Gujarat pogrom. Upset at the worldwide criticism of the state-assisted violence, and the effort of some small donor countries to fund relief and rehabilitation of the victims, the government kicked out numerous aid-givers in 2003, retaining only six—the US, the UK, Russia, Germany, Japan and the EU. It also announced it would no longer accept tied aid. Although the official explanation was that small donors’ aid was tiny and carried high administration costs, the real reason was political.

The United Progressive Alliance continued this policy. The irony of refusing aid, including assistance directed at poor people, struck nobody. In 2004, India launched a power-projection initiative by sending relief material and medical assistance to several countries affected by the tsunami. It was no accident that India used naval ships and personnel to deliver the aid.

India has since stepped up its assistance to developing countries through loan guarantees, technical training and some ODA. This was done partly to generate goodwill in countries where India is investing, and partly to balance growing Chinese influence, especially in Africa. But China is in an altogether different league. Its ODA is estimated at $25 billion; India’s is about $1 billion on the best estimates.

Now, the UK is about to substantially reduce its $610 million aid to “nuclear-armed” India, as International Development secretary Andrew Mitchell put it. This represents 29 per cent of all ODA to India. Under the Great Recession, Britain is stretched for resources and under pressure to better target its ODA. In addition, recent reports of massive embezzlement of aid to the Sarva Shiksha Abhiyan have shocked the British public. Mitchell has exhorted Britain’s wealthy NRIs, many of whom are in the billionaire list, to do more to help their countrymen.

There are several ironies here. First, it is ludicrous to assume any solidarity between British NRIs and the Indian poor. It is futile to try to shame rich Indian-origin Britons into helping India’s poor. The diaspora doesn’t suffer pangs of conscience about grinding poverty in the country it deserted for greener pastures.

Second, India refuses tied aid, but much of its own aid is tied to supplying Indian goods and services. Double standards? The only worthy thing about the India Development Initiative, apart from some assistance to neighbouring countries, is writing off debts owed by heavily indebted poor countries, including Ghana, Mozambique, Tanzania, Uganda, Zambia, Guyana and Nicaragua. The neighbourhood assistance programme is partly driven by political considerations: countering China and Pakistan.

The third, and greatest, irony is the persistence of acute poverty in India despite two very high growth decades in recent history—implying a grave failure on the state’s part to look after its own people. Yet, the state refuses aid that could potentially help the poor. For instance, two-thirds of British Department for International Development aid to India goes to health and education. This raises a serious moral issue. What right does a government have, other than brute power unrelated to genuine sovereignty, which it derives from the people, to refuse such aid?

The UN Development Programme has just released the Multidimensional Poverty Index (MPI) estimate that assesses different forms of deprivation in education, health, assets and services. These provide a fuller portrait of acute poverty than simple income measures. There are more MPI-poor (421 million) in eight Indian states—Bihar, Chhattisgarh, Jharkhand, MP, Orissa, Rajasthan, UP and West Bengal—than in the 26 poorest African countries (410 million).

The Indian elite has imposed an iniquitous, inequality-enhancing growth model upon the country. It has abysmally failed to provide basic public services, including food, safe drinking water, sanitation, healthcare and education, to the poor. To top it all, it now deprives them of ODA. This unjustly increases the burden on the already doubly disadvantaged.

Ultimately, the world will judge India’s success not on the basis of its IT achievements or number of billionaires, but on its ability to combat mass poverty. Will our elite ever use that yardstick?