March 2025

 

• Ayanangsha Maitra

MOST OF humanity in the world has lost in malaria or deadly deceases like tuberculosis – not the war. This is exactly why the USAID earned its reputation in the Global South by winning those wars and eradicating some of them absolutely and although it was an effective tool for the USA for excreting his mighty soft power, or say smart power. The United States Agency for International Development is better known by her nickname and highly popular in the low earning economies of the South and South East Asia for plenty of reason but mostly for reshaping the fate of health, education, and other humanitarian programs in the region. 

The agency, symbolized by colours mirroring the American flag – white, red, and blue – operates on the  “3Ds” framework: Diplomacy, Development, and Defense. In a dramatic move, the US President Donald Trump administration’s drastic cuts led to the abolition of 83% of USAID’s humanitarian programs around the geographies of the world. The Global South will feel the heat of the USAID restrictions, especially in the front of humanitarian assistance and long-term development initiatives. A host of INGOs and NGOs spread across the continents are forced to halt critical services even in the areas like health and nutrition, which are vital for vulnerable populations in developing countries. If USAID funding were halted for even a year, about 23 economies could experience shocks exceeding 1% of their Gross National Income, with some countries facing declines of over 3%. This is particularly critical for low-income nations that rely heavily on the U.S. aid say for example Nepal and Afghanistan. The cessation of support for health initiatives, such as those targeting malaria and HIV/AIDS, poses severe risks. For instance, the withdrawal of USAID support in regions like Myanmar could lead to a resurgence of diseases previously under control, threatening millions of lives in the impulsive nation, ruled by the junta. With USAID funding cuts impacting the World Food Programme, humanitarian aid delivery has been severely hampered, particularly in these two regions facing drought and conflict. South and South East Asia – both regions are leaders in  agriculture and the both are also improving in the fisheries sector. 

USAID: The Genesis and Programme

In 1961, at the height of the Cold War, President Kennedy incepted USAID via executive order to counter Soviet influence abroad, based on the 1961 Foreign Assistance Act. Congress formalized the agency as an independent agency in 1998, placing it within the executive branch but under the policy direction of the Secretary of State. Congress funds the agency every year. Under the Trump administration in 2025, the agency’s staff was significantly reduced, from over 10,000 employees to just a few hundred, with thousands more placed on administrative leave. USAID provides most of the U.S. aid for development and humanitarian needs around the world. In 2023, the agency allocated about $44 billion to 160 countries. Most of that money went to Europe and Eurasia, and sub-Saharan Africa. The embattled nation Ukraine received the largest share, almost 37% of the total. Several Global South countries rely on US foreign assistance for a substantial portion of their budgets.

The shutdown of USAID programs is likely to negatively impact America’s relations with several South and Southeast Asian nations. The reduction of USAID programs diminishes American soft power and geopolitical influence, particularly in regions like South Asia and Southeast Asia, where China is winning more hearts than ever. Such announcement may allow China and Russia to expand their influence through their capacity-building, infrastructure building and outreach drives. Without continued support, key initiatives aimed at building self-reliance and sustainable growth may collapse. This could prolong cycles of poverty and instability in the region. Populations already facing crises—such as those displaced by conflict or natural disasters—are at heightened risk without ongoing support from USAID. Cuts to maternal health programs and childhood immunizations could lead to increased mortality rates among mothers and children in these regions. According to the International Narcotics Control Board’s 2023 report, South Asia is home to about 39% of the world’s opiate users.

 

The agency does a lot in Southeast Asia, a region combatting a host of hitting issues. Last year, the USAID spent about $860 million in the region, helping the nations like Cambodia, Laos, Myanmar, the Philippines, Thailand, and Vietnam. The most of the amount was paid for  healthcare, growing the economy, education, and government programmes.

In the Southeast, the agency’s programme is also for support small businesses and farming. This is important for poor countries like Cambodia and Laos. They need help from other countries to keep their economy going. If these programs ceased, more people could get sick and more children remain unskilled and uneducated.   Trump’s worldview is reflected in his policies. Trump’s America is obviously not that of President Kennedy. Nor the momentum of multipolarity is similar to that of the Cold War that hatched the USAID. Civil society across the South Asia, as seen in nation like Sri Lanka, needs to be more proactive in dealing with compelling challenges in the homeland. A nationalistic policy for self-supporting development budget and more comraderies within the fraternity will be trending.  

This is the momentum for the BRICS nations like India, China, Russia, as well as minerals-rich Middle Eastern economies, to step into the funding vacuum left by the US. The limitation of USAID not only jeopardizes immediate humanitarian assistance but further threatens the long-term developmental prospects of several nations in South and South East Asia as well as the rest of the world. However, the USAID remains a tiny share in the US state budget. As the regions grapple with the consequences of reduced aid, it becomes increasingly apparent that such policies can have far-reaching effects that extend well beyond their borders. Addressing these challenges requires a reevaluation of the US foreign aid priorities to ensure that they align with both humanitarian needs as well as strategic interests. Ultimately, the reduction in USAID funding signifies a pivotal moment for BRICS nations and regional partners to assume greater responsibility in the era of multipolarity. 

[ Ayanangsha Maitra is a Journalist and New Delhi based Fellow at COGGS. ]