CONFIDENTIAL
GENERAL DISCUSSIONS
6. The meeting then discussed the following points relating to the Framework:
a.
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e
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India. It was suggested that this was a crucial allocation in the Framework context and that it would be helpful to have prior guidance on the percentage of disposable bilateral financial aid that could acceptably be allocated to India. Without this the shaping of the rest of the programme would be difficult. For various reasons the three other low income countries with large populations (Pakistan, Indonesia. Bangladesh) which were priority areas for aid two years ago. were not at present candidates for large additional sums. allocation of, say, 30-35% of the Programme for India would be justified in terms of need and general criteria. However, it was unlikely to commend itself to other Whitehall departments. It was suggested that the best procedure would be for the response to the bidding prayer to indicate a range of possibilities for India, related to the achievable rate of disbursements and the likely effect on other donors' responses.
Local Costs. It was suggested by some of those present that. since local costs were likely to form a large part of rural development coets, an across-the-board approach should be made to the Treasury to ensure that there should be no undue restriction on the use of our aid for local costs. However, it was pointed out that in many cases Treasury views already allowed generous amounts of local cost aid and that a general relaxation would probably be hard to negotiate. Accordingly.. a case-by-case approach was favoured.
Defining Rural Development. Identification and, even more, initiation of comprehensive projects could be a fairly long- term job, although there might be cases where a contribution in the form of specific inputs could be got under way more quickly. The ODM group under Mr Martin's Chairmanship were to seek the assistance of overseas posts and Development Divisions in defining rural development and the inputs needed to promote it. Draft guidelines would be circulated shortly. A Principal (Mr McCulloch) was now working full time on rural development in Social Affairs Department. But bids for country allocations in the Framework should not be held up pending precise definitions.
Dependencies and Associated States. It was unlikely that Dependencies would get less than previously planned in any new Framework. There was a problem over meeting recurrent costs in the Dependencies and Associated States if rural development projects were to be undertaken there.
Difficulties of introducing a "poverty-orientated" programme. The pursuit of a "poverty-orientated" programme involving the application of aid to rural projects could raise problems for
/Development
CONFIDENTIAL