Foreign aid to India

The Indo-US bilateral relationship which was based on US Aid to India had no deep roots. Its growth was rather greatly retarded by constant misunderstandings. India did not want American friendship on the basis of US-Aid. Every country gave aid or received aid some way or the other. What India received as "AID" was loan repayable with interest. India received US aid in large quantity. But the US economic assistance was very expensive to India. It helped India in some areas but it helped the United States to a greater extent.

India followed a policy of non-alignment because India wanted permanent peace and did not want to get entangled in Cold War or such agreements. But the United States did not believe in India's non-alignment policy. Neither did the United States appreciate the development of heavy indu stries in the Public Sector of her economy. Although the initial talks were with some US company(for setting up of Steel industry in India, they backed out. Under those critical circumstances, the Soviet Union came in and helped India with the steel mills in India for India's development and prosperity.