**India-Bangladesh Ties Take a Hit: Allocation for Bangladesh in Union Budget 2026-27 Reduces by 50%**
The Indian government has significantly reduced its allocation for Bangladesh in the Union Budget 2026-27, allocating only **Rs 60 crore**, a 50% drop from the previous fiscal year’s allocation of **Rs 120 crore**. This development comes amid escalating diplomatic friction between the two nations, particularly over violence against minorities and Bangladesh’s shift towards Pakistan.
The Ministry of External Affairs has been monitoring reports of attacks on minority communities in Bangladesh, including homes, properties, businesses, and places of worship. India has consistently raised concerns about the safety and security of these minorities with Bangladeshi authorities at both political and diplomatic levels. The ministry has also criticized the interim government’s tendency to attribute such attacks to personal rivalries or political differences, which only emboldens extremists and deepens fear among minority communities.
This reduction in allocation comes as India-Bangladesh ties have continued to deteriorate since 2024, with Bangladesh pursuing closer ties with Pakistan. Meanwhile, Bhutan remains the largest recipient of Indian foreign aid, with an allocation of **Rs 2,289 crore**, an increase from last year’s allocation of **Rs 2,150 crore**.