NCPA - National Center for Policy Analysis

Silver Lining In Sanctions Against India

May 21, 1998

The U.S. sanctions being imposed on India as punishment for its nuclear testing could very well benefit U.S. taxpayers -- by halting the flow of government aid and corporate welfare.

  • Nearly $20 billion in aid had been planned for India -- with tax money being used to pay for agricultural exports, the Agency for International Development, the Trade and Development Agency, the World Bank, the Export-Import Bank and the Overseas Private Investment Corp.
  • The Ex-Im Bank and OPIC money would have gone to subsidize corporate welfare for such companies as Boeing, Coca-Cola, General Electric and Westinghouse, according to the Cato Institute.
  • Prior to the May 13 sanctions, OPIC had approved more than $1 billion for U.S. firms doing business in India, with another $10.2 billion in the pipeline
  • Meanwhile, the Ex-Im Bank was forced to halt $500 million in payments, with another $3.5 billion pending approval.

Specialists say that Ex-Im financing last year for a $500 million Boeing deal is assured -- but another deal worth $2 billion to Boeing is on hold. A $500 million deal for Hughes Electronics is assured, along with $600 million Lockheed Martin contract and a $2.5 billion Enron Corp. project.

Source: Editorial, "Corporate Welfare in India," Investor's Business Daily, May 21, 1998.


Browse more articles on Tax and Spending Issues