February 4, 2025
Anit Mukherjee, Senior Fellow, ORF America was quoted in an article by Ken Moriyasu of Nikkei Asia on the global impact of the recent halt of foreign assistance from USAID.
USAID closure disrupts Indo-Pacific aid coordination plans
WASHINGTON -- The Trump administration's attempts to shutter the U.S. government's foreign aid agency have startled Asian development officials who had hoped to team up with Washington to offer countries in the region an alternative to Chinese assistance.
"It's so abrupt," a Washington representative at an Asian development government agency told Nikkei Asia. "Coordinating development policies with allies and partners was one of the pillars of the Biden administration's Indo-Pacific policies," the official said.
At the Camp David summit of August 2023, which brought the leaders of the U.S., Japan and South Korea together, the three sides agreed to deepen development policy coordination to strengthen Indo-Pacific engagement and promote common prosperity.
"Together, we are committed to accelerate the clean energy transition; mobilize financing for quality infrastructure and resilient supply chains, including through trilateral collaboration among our development finance institutions," a joint statement declared.
When then-Japanese Prime Minister Fumio Kishida came to Washington for a state-level visit in April 2024, he and then-President Joe Biden announced the establishment of a new strategic dialogue to coordinate global diplomacy and development efforts at the deputy secretary of state and vice minister for foreign affairs level.
"The whole idea was to offer an alternative to Chinese development aid by combining the capabilities of like-minded partners," the Asian development official said.
Such plans looked far from viable Monday with the lights turned off at the headquarters of the U.S. Agency for International Development, across the street from the White House. Employees were told by email to stay home.
In front of the stone building, Democratic lawmakers spoke to reporters and protesters opposing the move.
Rep. Gerry Connolly, the ranking member of the House Committee on Oversight and Government Reform, criticized Tesla CEO Elon Musk, who heads the Trump administration's "Department of Government Efficiency" advisory body, as an "unelected billionaire oligarch" unqualified to carry out such drastic changes. DOGE officials entered USAID headquarters over the weekend and reportedly attempted to access classified material.
"We are going to fight in every way we can -- in the courts, in public opinion, with the bully pulpit, in the halls of Congress, and here at AID itself," Connolly said.
"We are not going to let this injustice happen," he said. "Congress created this agency with the Foreign Assistance Act of 1961, and if you want to change it, you got to change that law."
On Monday, President Donald Trump appointed Secretary of State Marco Rubio as acting administrator of USAID, signaling a potential merger with the State Department.
Speaking to reporters in San Salvador, El Salvador, Rubio called USAID "a completely unresponsive agency" that is not aligned with American foreign policy.
While many of USAID's functions will continue, he said, the administration will ensure that "every dollar we are spending abroad is being spent on something that furthers our national interests."
Anit Mukherjee, a senior fellow at the U.S. arm of Indian think tank the Observer Research Foundation, said the move is a shock not just to USAID employees, but to the entire system of global development cooperation.
Halting U.S. assistance will be a major blow to countries in South Asia, such as Bangladesh, Afghanistan, Nepal and Myanmar, Mukherjee said.
"Bangladesh would be really hit because there was a lot of programs in Bangladesh which were dependent on USAID money," he said.
With a new Bangladeshi government that has distanced itself from India, "their first port of call might be China rather than India," Mukherjee said.