Seminar paper from the year 2013 in the subject Sociology - Economy and Industry, University of Dhaka, language: English, abstract: The effectiveness of foreign aids to the third world developing countries is a controversial issue. Liberal economists thought, key to economic success is appropriate usage of loans, and if it is utilized effectively, such loans can have a hugely important role to play. Loans can contribute to poverty reduction, to fill the deficit of budget gap, to build big construction such as bridge, roads, public buildings, educational institutions etc. But critique of foreign aid such as Andre Gudner Frank argues that foreign aid is a means of domination, dependency, exploitation to the third world developing countries. In the colonial era, imperialist countries accumulated raw materials, natural resources, mineral resources etc. directly through colonialism or imperialism. In the present neocolonial or neoliberal society, aid is a new form of domination, dependency to the third world countries and also a means of trade, marketing of machineries, technologies etc. Bangladesh, located in South Asia, is one of the poorest countries in the world. According to the UNDP’s 2010 Country Summary report, the country has a large population 164.7 million and having GDP per Capita is $ 1300. External debt is $ 316.7 per $ 1000 GDP. Foreign aid both grants and loans has impacts on the economy of Bangladesh. It contributes to the development works like bridge, roads, highways, infrastructural works etc. But it is also leading to growing indebtedness, dependency, domination etc. Padma Bridge project is the most recent and best example of foreign aid as means of development or dependency of a country. World Bank is gradually delaying the project for the acquisition of corruption against SNC- Lavalin Company and former communication minister Sayad Abul Hoshen etc. But there is also acquisition against World Bank that it was itself was in favor of fault lender institution. Recently, Bangladesh has withdrawn its proposal from World Bank but World Bank has declared that proposed loan for Padma Bridge is fixed for Bangladesh and Bangladesh can use the loan in other development projects. My paper argues that foreign aid has impact on the development but it is also means of domination and trade of donors. Bangladesh is not self sufficient not to take the aid but if the aid is channeled through appropriate biding and utilized effectively, such aid can have hugely important role for development.

Assessing Aid determines that the effectiveness of aid is not decided by the amount received but rather the institutional and policy environment into which it is accepted. It examines how development assistance can be more effective at reducing global poverty and gives five mainrecommendations for making aid more effective: targeting financial aid to poor countries with good policies and strong economic management; providing policy-based aid to demonstrated reformers; using simpler instruments to transfer resources to countries with sound management; focusing projects oncreating and transmitting knowledge and capacity; and rethinking the internal incentives of aid agencies.

Explores the different choices made by donor governments when delivering foreign aid projects around the world.

Foreign Aid and Bangladesh offers a rich combination of aid history – from the evolution of aid as a global agenda after WWII to the rise of different multilateral, bilateral, and emerging donors and their policy shifts – and a nuanced perspective of aid partnerships at the country level. Drawing on first-hand experiences and insights, the author deeply investigates the realities of a longstanding aid recipient, Bangladesh, and argues that without a political economy approach, one cannot understand the realpolitik of development aid. As an emerging economy from the global south, Bangladesh has been a longstanding partner and recipient of international aid since 1971. Bangladesh has also been active in the global discussions leading to redefining the new narrative and arguments for the new aid regime since the beginning of this century. Building on the analysis of Bangladesh's aid relations, the book shows that there has not been any qualitative shift in aid behavior in the new aid regime that set new norms after the end of the Cold War to ensure recipients' ownership and welcomed an expanding aid landscape by integrating emerging economies from the Global South for achieving better development results. The book analyzes the role of different actors in the development partnership, both traditional and emerging donors - such as China and India, and their partnership practices. It examines different forms of aid and their changing perspective, particularly technical assistance. Based on more than two decades of research and profound insider observations, the book debunks the myth that Southern providers could be more benign to their partners. The arguments placed in the book expose that there is no difference between traditional and emerging donors in ensuring donors' business and strategic interests. While donors continue to ensure their interests in providing aid, the Realpolitik of the situation in the recipient country shows that there is a specific economic and political agenda in pursuing aid. Presenting a comprehensive picture of Bangladesh's aid partnership, through the lens of new development partnership principles and narratives of development aid, this book will be of interest to scholars and researchers of aid and development studies and political science as well as South Asian Studies. Donor officials, civil servants, and national and international policy communities will also benefit from this book.

Over the past twenty years more citizens in China and India have raised themselves out of poverty than anywhere else at any time in history. They accomplished this through the local business sector the leading source of prosperity for all rich countries. In most of Africa and other poor regions the business sector is weak, but foreign aid continues to fund government and NGOs. Switching aid to the local business sector in order to cultivate a middle class is the oldest, surest, and only way to eliminate poverty in poor countries. A bold fusion of ethics and smart business, The Aid Trap shows how the same energy, goodwill, and money that we devote to charity can help local business thrive. R. Glenn Hubbard and William Duggan, two leading scholars in business and finance, demonstrate that by diverting a major share of charitable aid into the local business sector of poor countries, citizens can take the lead in the growth of their own economies. Although the aid system supports noble goals, a local well-digging company cannot compete with a foreign charity that digs wells for free. By investing in that local company a sustainable system of development can take root.