New Delhi: For much of the post-independence period, India remained a significant recipient of international development assistance even as it began building its own development partnerships with other developing countries. Through initiatives such as the Indian Technical and Economic Cooperation (ITEC) programme, established in 1964, India was simultaneously a recipient and provider of development cooperation. Today, however, the scale and nature of that role are changing. This signals a change in the nature of India’s development diplomacy. Instead of simply transferring resources, India is now also sharing technology, institutional know-how and policy expertise. Such partnerships can simultaneously foster development in partner countries, create opportunities for Indian firms, and deepen India’s economic and diplomatic ties across the Global South.
However, the fact that an Indian model has international resonance does not necessarily mean that it is readily transferable. India’s digital transformation was shaped by particular institutional, regulatory and economic conditions that may not exist in other countries. Financial constraints, administrative capacity, data governance and political will are also likely to determine whether an imported system can achieve long-term sustainability or remains a pilot project. The question, therefore, is whether India’s development diplomacy is evolving into a form of economic and strategic statecraft, and how scalable that model really is.
From Aid Recipient to Development Partner
India’s transition from being a recipient of development assistance to a provider of development partnerships has been more evolutionary than revolutionary. Since 1964, the Indian Technical and Economic Cooperation programme has built capacity by training officials and professionals from developing countries. India has also extended concessional Lines of Credit to finance infrastructure and development projects across the Global South. As of August 2024, India had extended more than 300 concessional Lines of Credit worth around US$32 billion to 68 countries, covering approximately 600 projects across sectors including transport, power, agriculture, healthcare and information technology. These instruments laid the groundwork for India’s development cooperation, but the scale and nature of what India is able to offer today have expanded significantly.
The difference now is that India can increasingly offer institutional and technological solutions that it has developed at home, rather than only financial resources or technical training. Its experience in establishing digital identity and interoperable payment systems, as well as in digital governance and large-scale service delivery, has contributed to a different form of development diplomacy. The focus is therefore shifting, at least to some extent, from financing development to sharing the infrastructure and institutional capabilities that can enable it. This is also what distinguishes India’s approach from the traditional donor-recipient paradigm. India typically describes its development partnerships as being rooted in partnership, demand and mutual benefit, rather than simply in the transfer of knowledge from developed to developing countries. This distinction is particularly meaningful in the Global South, where India can position itself not as a distant model to be replicated wholesale, but as a country whose own experience offers pragmatic solutions to challenges faced by other developing economies. This is not to suggest that India is no longer a recipient of international development cooperation, or that its financial contribution is comparable to that of major traditional donors. Rather, India’s growing significance stems from a combination of finance, technology, capacity building and institutional know-how that it can bring to development partnerships. With the rise of digital public infrastructure, this transition is becoming increasingly apparent.
Exporting India’s Digital Public Infrastructure
Digital public infrastructure has perhaps been the most prominent instrument of India’s development diplomacy in recent years. What matters about India’s experience is not any single platform, but the infrastructure that underpins it: interoperable systems that enable governments, financial institutions and private companies to build services on shared digital rails. Aadhaar, the Unified Payments Interface and related platforms have demonstrated how digital infrastructure can be used to expand financial inclusion, facilitate payments and deliver public services at national scale. India’s efforts to internationalise its digital public infrastructure also extend beyond individual payment linkages. As of July 2026, India had signed memoranda of understanding with 24 countries for cooperation in sharing population-scale digital solutions, reflecting an effort to position its domestic digital architecture as a development-partnership tool.
The internationalisation of UPI is one example. India has established linkages or UPI-based payment acceptance arrangements with several countries, including Singapore, Bhutan, Nepal, Sri Lanka, Mauritius, the UAE and France. These collaborations have the potential to facilitate cross-border payments and deepen financial and commercial linkages with India. However, they should not automatically be treated as evidence that these countries have copied India’s payments ecosystem. In many instances, what has been exported is interoperability with UPI rather than UPI itself. Digital identity offers a more substantive and far-reaching form of institutional export. The Modular Open-Source Identity Platform, or MOSIP, incubated at the International Institute of Information Technology Bangalore, is an open-source platform that allows countries to develop and manage their own national digital identity systems while retaining sovereignty over their infrastructure.
Its adoption and adaptation in countries such as Ethiopia, the Philippines, Morocco and Uganda demonstrate how Indian experience can shape systems without requiring countries to replicate India’s institutional architecture. Ethiopia provides a useful illustration of this process of adaptation. Rather than adopting India’s Aadhaar system, Ethiopia used MOSIP’s open-source architecture to develop its own national digital identity programme, Fayda. Ethiopian authorities customised and extended the platform to meet local requirements, including the development of mobile registration capabilities to support enrolment in rural and remote areas. The case illustrates that what is being transferred is not an Indian system in its entirety, but a modular architecture that can be adapted to local institutional and administrative realities. This distinction between replication and adaptation is central to understanding India’s emerging development diplomacy. India is not simply exporting a ready-made “India Stack” to the world. Instead, it is sharing ideas around open standards, interoperability and reusable public digital infrastructure. This could make its digital diplomacy more scalable, provided these principles can be adapted to countries with very different institutions, regulatory environments and levels of state capacity.
Development Partnerships as Economic Statecraft
India’s development diplomacy is increasingly taking on the characteristics of economic and strategic statecraft. Its Lines of Credit finance infrastructure projects across the Global South while creating opportunities for Indian firms to provide goods, services and expertise. Meanwhile, programmes such as ITEC train foreign officials and professionals across sectors including governance, finance and information and communication technology, creating longer-term institutional networks. An assessment by the Observer Research Foundation notes that India’s Lines of Credit serve multiple objectives: generating economic benefits, supporting project implementation and strengthening diplomatic and strategic relationships with partner countries. The programme can also help Indian exporters enter new markets, demonstrating the overlap between development cooperation, commercial interests and strategic engagement.
The significance lies in this combination. India is not only financing projects or transferring skills, but also building economic and institutional relationships. Development cooperation can therefore function simultaneously as a development instrument and a form of economic statecraft. The strategic value of this approach lies in its cumulative effect. A country that engages with India through training, infrastructure finance and digital systems can develop deeper economic and institutional links with India over time. Development cooperation thus becomes not just an instrument of assistance, but a means of building long-term influence and interdependence.
The Limits of Replication
Yet the international appeal of Indian models does not guarantee their replicability. India’s digital transformation emerged from a particular combination of institutional capacity, regulatory frameworks, digital infrastructure and a vast domestic market. Countries lacking these conditions may struggle to reproduce the network effects behind systems such as UPI. Institutional capacity also determines whether imported systems can be sustained beyond their initial implementation. At the same time, digital identity and payment platforms raise concerns around data governance, privacy, cybersecurity and political acceptance. These challenges mean that technological solutions cannot simply be transplanted across different political and institutional contexts. The scalability of India’s development diplomacy therefore depends less on exporting fixed models and more on adapting their underlying principles to local needs and capacities.
Conclusion
India’s development diplomacy is increasingly taking on the characteristics of economic and strategic statecraft. Its growing ability to combine finance, capacity building, technology and institutional expertise allows it to build relationships that extend beyond conventional aid. However, its influence will not be determined by how many countries directly adopt Indian systems. The more important test is whether India can help countries develop solutions suited to their own institutional and political contexts. India’s experience therefore suggests that the most exportable element is not a specific platform such as UPI, but the broader principle of building interoperable, scalable and locally adaptable public infrastructure. If India can translate its domestic experience into such partnerships, its development diplomacy could become a significant source of influence across the Global South.
