Aid Interrupted: Reverberations in Sri Lanka of USAID’s Dismantling

Sandunlekha Ekanayake

Trump’s ‘America First’ doctrine
In a shocking move, President Donald Trump’s ‘America First’ right-wing populism and economic nativism has led to defunding the United States (US) Agency for International Development (USAID). Growing negative sentiment towards USAID had been fuelled by Trump during the 2024 election campaign, with the rhetoric that funding did not have a direct return for the US people and was wasteful. What began on 20 January 2025 as a 90-day pause on all foreign aid, eventually escalated into hundreds of USAID officials being placed on leave before being laid off, the USAID website being taken down, and 83% of foreign aid contracts, i.e., a total of 5200 contracts, being spiked by 10 March 2025. This roughly amounts to a withdrawal of over 50 billion USD affecting a vast majority of countries in Asia, Sub-Saharan Africa, and Eastern and Central Europe. This was accompanied by the threat that over 90% of USAID projects worldwide would be discontinued. The sectors that are being actively pummelled are ones such as healthcare, education, global climate finance, loss and damage adaptation, humanitarian aid, refugees, Diversity, Equity and Inclusion (DEI) programmes, and food security. In the most recent development, Trump has driven the final nail in the coffin by bringing the leftover USAID projects under the jurisdiction of the US Department of State and  announcing the elimination of all USAID overseas positions on or before 30 September 2025.

While acknowledging that the dismantling of USAID is misguided, miscalculated, and has flung the development industry into chaos, this commotion also unveiled the many faces of USAID. Evidently, the slashing of USAID funds has been felt adversely by almost all recipient countries. There is no denying that. At the same time, USAID is a tool in the power dynamics of imperialism. All foreign funding that flows into recipient countries from donor countries is a strategic political tool. Foreign aid is tied to the foreign policy agendas of developed states, regardless of its source or intended use. It serves as a tool of economic statecraft, where countries use financial resources to advance their diplomatic goals; an approach that is more popularly known as ‘soft power’. Donor states also influence multilateral aid organisations, aligning the latter’s involvement with the giver’s interests. Therefore, when analysing foreign aid, it is essential to consider the strategic intentions of the donors, as the term ‘aid’ often conceals these underlying motives (Bastian 2025). Thus, the debate surrounding the dismantling of USAID can be positioned as a spectrum of views, rather than a binary of ‘for’ or ‘against’.

The impact of the discontinuation of USAID on the world as a whole is extensive. Heath (2025) draws on former USAID worker Wayan Vota’s spreadsheet, which can be cross-referenced with Health Policy Watch’s 365-page document. According to the World Health Organisation (WHO), treatments for HIV/AIDS, tuberculosis, malaria, Ebola and malnutrition have either been halted or completely cut in more than 50 countries (Hutchinson and Roxby 2025). This includes PEPFAR (President’s Emergency Plan for Aids Relief), which has saved over 25 million lives. Other casualties include a 40 million USD initiative in the Philippines aimed at supporting early childhood education. In March 2025, Human Rights Myanmar announced that their war-torn country was set to lose an estimated 1.1 billion USD as a result of USAID cuts. The recent deadly earthquake that hit Myanmar revealed a palpable absence of US rescue and Disaster Assistance Response Teams on the ground, except for three persons.

Trump and Elon Musk’s collective effort to knell the bell on USAID is not admirable nor is it a cause for celebration. In the US, the key players of the anti-USAID discourse are Trump and his far-right administration. Trump, who has had a long-standing aversion towards overseas aid, has posted that USAID expenses are “totally unexplainable” and demanded to “close it down”, because it does not align with his ‘America First’ vision. Musk amplified this sentiment by calling it a “criminal organisation” that needs to “die”. The South African-born billionaire, who was tasked by Trump to ‘get rid’ of USAID and head the Department of Government Efficiency (DOGE) took to the X social media platform (formerly Twitter) that he owns, to mis-characterise many US-funded projects. For instance, he alleged USAID has also spent 7.9 million USD “to teach Sri Lankan journalists how to avoid ‘binary-gendered language’” and that most of these projects are a  “[c]razy waste of your tax money!”.

Musk’s words, albeit unsubstantiated and false, carry power because, until their recent spectacular fallout, he was considered influential with Trump. His omnipresence and toxic influence in the federal government is a by-product of the decisive role he played in bringing Trump back into the Oval Office. He not only poured millions into Trump’s campaign, but also actively shaped the latter’s policies and promoted his agenda, including using the X platform to mainstream the ‘Make America Great Again’ (MAGA) discourse. Musk has attempted to justify his actions through a mix of conspiracy theories, disinformation, and outright lies. He has labelled USAID a “viper’s nest of radical-left Marxists”. He has compared USAID to a global terror network, referencing its involvement in regime change and political meddling. Yet this offensive is not rooted in a genuine critique of US imperialism – it springs from a more opportunistic agenda (Chavez 2025). Therefore, despite the very public and entertaining end to the Trump-Musk relationship, Musk had already done irreversible damage during his tenure of 130 days as chief arsonist at the helm of DOGE.

Trump’s policies have been clustered in four sections, namely ‘Make America Safe Again, Make America Affordable and Energy Dominant Again, Drain the Swamp, and Bring Back American Values’. At their crux are hostility and hate towards undocumented immigrants, economic protectionism, energy dominance (lifting restrictions on oil, gas exploration, and withdrawing from the Paris  Climate Accord), deregulation, reformation of courts to reflect a more conservative interpretation of the Constitution, tax reforms, and an onslaught on DEI policies, promoting conservative ‘family values’ such as recognising only two genders of male and female as a “biological reality” and opposition to so-called “radical gender ideologies” including medical care for transgenders (The White House 2025).

Flowing from this school of thought, the White House framed four types of USAID programmes as “waste, abuse, fraud [and] crap”. These projects allegedly included 1.5 million USD to advance DEI in Serbia’s workplaces, 70,000 USD for production of a DEI musical in Ireland, 47,000 USD for a transgender opera in Colombia, and 32,000 USD for a transgender comic book in Peru. These are peanuts in comparison to USAID’s 21.7 billion USD portfolio and the close to 1 trillion USD defence budget in 2024. The Executive Order demonstrates the administration’s perception of downsizing international aid as a means to advance its domestic ideological battle against socially and politically progressive policies. The Order criticises the foreign aid industry and bureaucracy, arguing that it often contradicts US values. It also claims that such aid disrupts global stability by introducing ideas in other nations that undermine both internal harmony and peaceful international relations (McVeigh 2025). This campaign to dismantle USAID should not be seen as a good result, because of the motivations underlying it. This action—already the subject of legal challenges—is both unlawful and undemocratic, disrupting vital global initiatives. The administration’s intention to fold USAID into the Department of State would likely deepen the damage.

As an extension, the US decision to cut development aid has had a ripple effect across other Western donor nations, with countries like Britain, France, and Germany echoing the rhetoric and initiatives of funding cuts. While their motivations may diverge from those of the US, the outcomes point to a shared trajectory, hinting at how most Western countries are devotees of different avatars of populism. Shortly after Trump’s announcement regarding USAID, UK Prime Minister Keir Starmer revealed a hike in defence spending to 2.5% of national income by 2027, funded by slashing the UK’s aid budget from 0.5% to 0.3% of gross national income over the same period. This marks a continuation of Britain’s aid reductions since 2020, pushing support to its lowest level in decades, and severely affecting long-term development partners and ongoing humanitarian initiatives.

USAID’s footprint in Sri Lanka
The USAID portfolio in Sri Lanka was large and diverse. The abrupt closure of its programmes left an unprecedented void, especially for community-based and non-governmental organisations (CBOs and NGOs). As per assessments done by officials from the National NGO Secretariat, nearly 50% of the funding received by NGOs originates from USAID, amounting to approximately 15 billion LKR in the past year (Alphonsus 2025). According to Marc-André Franche, the United Nations Resident Coordinator in Sri Lanka, the US contributes approximately 12% of the United Nations’ annual budget in Sri Lanka, supporting 10 ongoing initiatives. These initiatives are claimed to align with the Sri Lanka government’s priorities and focus on areas such as agriculture, climate resilience, disaster readiness, youth entrepreneurship, and border and maritime security (The Sunday Times 2025).

Besides the impact on NGOs, government programmes supported by USAID were also affected. These include initiatives that provide expert assistance to parliamentary committees, such as Sectoral Oversight Committees, the Committee on Public Finance (COPF), and the Women Parliamentarians’ Caucus (Alphonsus 2025). At the time the Executive Order was issued, USAID and the Sri Lankan parliament were engaged in discussions about continuing their collaboration. Another notable collaboration between the government of Sri Lanka and USAID was a project to reduce case backlogs, by linking computer databases across 15 courts to a centralised network. However, following the initial 90-day freeze of USAID, the computers were disconnected, bringing the project to a standstill (Gajanayake 2025). The removal of the official USAID Sri Lanka website has further hindered efforts to understand the scope of its projects, and highlights a broader concern about declining transparency and accountability in the US government’s engagement with recipient countries.

Gauging from what was gathered from secondary sources and the USAID Sri Lanka Facebook page, the situation is serious. Co-Convenor of a civil society group under the name ‘CSOs and NGOs Collective’ and the executive director of one of its member organisations, Right to Life, Philip Dissanayake highlights that those most affected in the NGO sector are those working on gender issues, LGBTQIA+ rights, human rights, and inclusivity (Chamara 2025). For instance, Women In Need (WIN), a vital NGO dedicated to assisting survivors of domestic and gender-based violence through counselling, emergency shelters, and legal aid, currently faces a major crisis as approximately 85% of its operations relied on USAID funding. Its Crisis Centre in Ratnapura, established solely through USAID support, is staffed by seven professionals, including lawyers and counsellors. Last year alone, this centre was a lifeline for 950 women (Alphonsus 2025).

To comprehend the weight that aid has carried in Sri Lanka, from 1973 to 2023, when adjusted for inflation, the cumulative value of grants pledged over the past 50 years amounts to roughly 18% of Sri Lanka’s Gross Domestic Product (GDP) in 2023 (Verite Research 2025). Sectors such as conflict management and assistance, disaster management and assistance, institutional capacity building, and governance support were mostly under the jurisdiction of UN grants, whereas budget support and industry/business development were USA grant priority areas.

From 2000 to 2023, the US has provided a total of 220 million USD in humanitarian aid to Sri Lanka via UN organisations and third-party donors. In comparison, similar assistance from countries like Japan and China over the same period only amounted to 76 million USD and 5 million USD respectively, putting the donors and their volumes into perspective (Verite Research 2025). Significant projects such as the 1950s initiatives to improve child and maternal nutrition, including school feeding programs and efforts to minimise maternal nutrition deficiencies through programmes such as Thriposha^[1] were kept afloat through occasional funding and assistance by USAID. In the wake of the tsunami, USAID provided over 134 million USD in tsunami aid to Sri Lanka, funding infrastructure and community projects such as bridges, vocational schools, fishing harbours, water systems, and children’s parks, along with numerous rebuilt schools, libraries, and roads. Since 2003, USAID’s Office of Transition Initiatives (OTI) programme has contributed 4.78 million USD to over 210 peace-building initiatives across Sri Lanka. Even during the post-war recovery period, foreign assistance was instrumental in Sri Lanka’s development, particularly in funding large-scale infrastructure projects such as power generation and roads (de Mel 2010). Therefore, despite a diversity of donors in Sri Lanka, these will be insufficient to fill the void that USAID cuts have created, in terms of the volume that they brought in, and the sectors or kinds of activities funded.

There are multiple considerations when looking at USAID’s role in Sri Lanka as a separate entity and when analysing it against other foreign donors. Primarily, it is true that comparing one donor against another helps to scale their scope and impact. It is also true that when compared, at a glance, USAID offers the bigger slice of the donor pie. At the same time, probing beyond the numbers presented at face value prompts one to consider whether USAID being the biggest donor translates into greater effectiveness.

Foreign aid as a whole has its visible and hidden negative impacts too, not least among which are the ideologies and politics at play amongst donors and recipients. USAID is no exception. After taking all of USAID’s avatars into consideration, scrutinising the most recent events in the light of USAID cuts reveal that, while several of the impacted USAID projects were those supporting democratic change and social development, this has historically not always been the case. In practice, foreign aid often has a dual nature: it provides resources enabling activists to carry out valuable work, yet it can simultaneously ensnare them in a cycle of material and psychological dependency. Recipients of such funding may even face political repression when authorities perceive their initiatives as foreign-sponsored. Moreover, the protocols and frameworks attached to foreign aid are frequently stifling and controlling, with strings attached. Critics note that Western governments often use such aid to further their foreign policy objectives, and as Sandal (2020) argues, an excessive reliance on such assistance can promote state corruption, enrich self-interested elites, undermine human development, and stunt economic growth. Even though empirical findings arrive at generalisations that show long-term foreign aid to be user-friendly and support development of countries, a country-by-country analysis will highlight its unsustainability.

Framing the cuts: Strategic repositioning of Sri Lanka’s nationalist politics
​The Sri Lankan government has expressed significant concern over the freeze in USAID funding. Cabinet Spokesperson Dr. Nalinda Jayatissa assured that the government will sustain USAID-funded projects in Sri Lanka by securing alternative funding sources. However, what these alternatives are, has not been explained. Sri Lanka’s response to the USAID funding cuts has been notably reactive, mirroring the defensive posture seen in its handling of the US tariff escalation. In both instances, the government appeared unprepared for the sudden shifts in US policy, scrambling to mitigate the fallout rather than proactively engaging with diplomatic or strategic alternatives. Following the USAID halt, officials expressed concern over the lack of formal notification and swiftly moved to identifying alternative funding sources, much like their immediate formation of a high-level committee and initiation of virtual talks in response to the tariffs. Although the government, a vocal critic of foreign-funded NGOs while in opposition, would welcome the curtailment of certain advocacy groups, the broader freeze of USAID assistance has forced the Finance Ministry to pursue alternative financing — including negotiations with the World Bank, the Asian Development Bank, and other bilateral donors — while simultaneously exploring domestic strategies such as budget reallocations and reprioritisation of expenditures to sustain at least a dozen vital development projects that were affected.

The dismantling of USAID and the political narrative surrounding it has, importantly, given impetus to the Sinhala Buddhist nationalist political forces in Sri Lanka. Namal Rajapaksa MP, National Organiser of the Sri Lanka Podujana Peramuna (SLPP), demanded an investigation into projects and grants that were backed by USAID. Taking to X, Rajapaksa said that USAID has become a site of controversy, especially with Western media insisting that it was used to cause chaos and destabilisation in other countries under the pretext of humanitarian aid. He also stressed the government’s responsibility to implement regulations on NGO funding and to create transparency and accountability around NGO financing (Ada Derana 2025).

In addition to Namal Rajapaksa, National Freedom Front (NFF) leader and former MP Wimal Weerawansa played his part in holding USAID and NGOs funded by it responsible for ‘international conspiracies’ by echoing Musk, even though he is not a natural sympathiser with Musk’s economic ideology. Weerawansa is a former Janatha Vimukthi Peramuna (JVP) leader who crossed over to the Mahinda Rajapaksa government in 2008. He is an avid critic of the West and globalisation, and favours policies that are protectionist and nationalist. For example, in 2014, he advocated the boycott of US brands such as Coca-Cola, Pepsi, KFC, McDonalds, and Google’s email service. This was in reaction to the UN Human Rights Council’s resolution that urged Sri Lanka to conduct an inquiry into accusations of human rights violations involving both state military forces and the Tamil Tigers during the final stages of the civil war. In 2023, Weerawansa penned a book titled “Navaya: Sengawunu Kathawa” (Nine: The Hidden Story) which documents his take on the Aragalaya, while directly hurling allegations at US Ambassador Julie Chung. The book claims that the US ambassador played a part in the ‘conspiracy’ to overthrow Gotabaya Rajapaksa’s regime (The Sunday Times 2023).

Meanwhile, Bodu Bala Sena (BBS) General Secretary, Ven. Galagoda Aththe Gnanasara, made sweeping claims that NGOs funded by USAID were anti-Sinhala Buddhist and were interested in creating a rift between ethnicities.^[2] He claimed that between 1 October 2013 and 31 July 2014, USAID allocated 8.1 million LKR to an organisation, allegedly with the intent of undermining the rights of Sinhala Buddhist groups. He also linked the 2022 Aragalaya to USAID funding by trying to connect two separate things: one being Brito Fernando–a prominent Sri Lankan activist known for his long-standing work in human rights and serving as Chair of ‘Families of the Disappeared’–receiving funding of 5.9 million LKR in 2013-2014 for the Right to Life Human Rights Centre, during which time he had apparently accused BBS of creating ethnic polarisation; and the other being Brito Fernando’s support for the 2022 Aragalaya. This rhetoric reframes the Aragalaya in a negative light and rides the hackneyed but effective coat-tails of Sinhala-Buddhist nationalism.

The Trump administration’s rhetoric against Diversity, Equity, and Inclusion (DEI) policies, alongside its onslaught against the USAID programme, has also fuelled anti-LGBTQIA+ sentiments in political rhetoric and popular discourse in Sri Lanka. Therefore, it is unsurprising that Weerawansa blamed USAID funded projects in Sri Lanka for nurturing gender reassignment and slowing the rate of population growth. Sinhala Buddhist nationalist movements and actors invoke the trope that the Sinhala Buddhist majority is under the constant threat of increasing numbers in ethnic and religious minorities; and beset by conspiracies of ‘evil foreign forces’ represented by NGOs to manipulate ‘Sinhalese’ women against procreating (Daniel et al. 2016).

Romanticising nationalism (in the wake of USAID cuts) and painting it in a heroic light to make it desirable, requires villainising marginalised communities such as LGBTQIA+ as demonstrated by the Sri Lanka ‘Mawwarunge Peramuna’ (Mother’s Movement), when they took to the streets in January this year to endorse Trump’s anti-LGBTQIA+ agenda and to denounce ‘wokeism’. Therefore, when discussing the end of USAID funding, it is paramount to scrutinise the choice and rebranding of words that political and social movements use to weave and market their story of nationalism.

But the story does not end there, especially when the public with a polarised view take to digital and public spaces such as Facebook and YouTube, either to resonate with nationalistic ideologies or to challenge this repertoire. For instance, YouTube channels such as ‘Iraj Show’–which hosted Wimal Weerawansa, following his allegation against USAID– and ‘SL Leaders’,  justify USAID cuts and discredit their recipients. Conversely, there are also comment threads on various platforms that speak against skewed narratives; some people called out Namal Rajapaksa on his X post. Patently, parties of all stripes advocating for and against USAID cuts are doing it to further their political mileage and not necessarily because they assume a critical stance towards foreign aid’s imperialist agendas.

Another aspect of the local politics surrounding the USAID cuts was the attack on domestic media personnel and institutions. For example, Weerawansa took a dig at the project “Media Empowerment for a Democratic Sri Lanka” (MEND) implemented by the International Research and Exchanges Board (IREX) with USAID funding (Daily Mirror 2025). MEND allocated its funding to various initiatives, including a media exchange program, investigative journalism workshops, web development grants for publications, digital literacy training, and support for pandemic and election reporting. Weerawansa zeroed in on the claim that the funding was used to “teach” (in a negative sense) Sri Lankan journalists how to avoid using binary-gendered language, even though this was only one component of the programme.

Weerawansa reiterates the same point during a press conference to attack the Prime Minister and Minister of Education in Sri Lanka, Dr. Harini Amarasuriya, for alleged attempts to inculcate gender and equality in educational reforms. He connects the two incidents by saying that similar to how journalists are being trained to use non-binary language, school children will also be influenced by such content, which he calls an “illness”. Weerawansa does not hesitate to also say that Amarasuriya apparently appears to have this “illness”.

These narratives lend credibility to President Trump’s claims that USAID and similar funding are often met with local criticism and offer little tangible return to the US. This dovetailing of local nationalist and populist discourse with the Trump administration’s scepticism towards foreign aid indicate the convergences between and among right-wing populist movements across the world, mediated by public spaces such as the internet and social media.

Building resilience in a post-aid world: What do alternatives look like?
The present moment of USAID cuts could be used as an opportunity for countries that were dependent on foreign aid to look for more sustainable alternatives and to diversify sources of funding. Some perceive the USAID cuts as symbolic of the US loosening its grip on countries it once heavily influenced through aid-dependent relationships.

In Asia, there has been a persistent downward sloping curve where countries like India have had a volatile relationship with foreign aid since independence. Up until 2003, India acknowledged their need for aid but with the awareness that they did not have the upper hand in deciding its terms and conditions, especially when the donor used it as a geopolitical tool. This was exemplified by the PL-480 assistance program, wherein the US explicitly framed its financial support as politically motivated and contingent on reciprocal concessions. Initiated in 1954 by President Dwight D. Eisenhower, the programme known as Public Law 480  (PL-480), or ‘Food for Peace,’ was originally a means for the US to dispose of surplus grain stockpiles while advancing its geopolitical influence. For India, led by Prime Minister Jawaharlal Nehru, this arrangement initially provided a practical solution for meeting food shortages and allowed government funds to be directed toward industrial growth. However, by the mid-1960s, it became evident that such external assistance carried implicit political conditions; the US at one point nearly halted wheat deliveries, placing India at risk of famine and exposing the vulnerabilities of relying on foreign support. Subsequently, India embarked on its Green Revolution to achieve agricultural independence and reduce susceptibility to international pressures–illustrating how aid can function as an instrument of political control. This acted as a precedent that impacted India’s foreign aid policy, reinforcing a long-term scepticism towards it.

As a whole, due to economic growth in Asia, the 53 billion USD that the region received in foreign aid from OECD countries in 2023 represented only 0.2% of its total gross national income (GNI), a decline from 0.7% in 1993 and significantly lower than Africa’s 2.4%. Despite the figures, even Asia will not escape unscathed as many countries’ health, natural disaster management, new policy frameworks, food, and education sectors (to name a few) were sponsored by foreign aid. As European nations and even countries such as Japan increasingly redirect foreign assistance budgets to boost their own defence capabilities, the burden of finding resources shifts further onto recipient states.

In the aftermath of the USAID cuts, it is widely anticipated that China, with its growing regional influence and soft power, will seek to occupy the space the US has left behind. However, this shift will not come without its own set of contradictions. While the nature of these strings may differ from those historically associated with US aid, they are likely to be equally attached. China’s priorities operate on a fundamentally different axis: rather than providing traditional aid, Beijing largely focuses on extending repayable loans and financing large-scale infrastructure projects. While it promotes South-South cooperation as an alternative to Western-led aid regimes, China is unlikely to champion democracy promotion, civil society, media independence, or rights-based agendas concerning women and LGBTQ+ communities (Ramos 2025). Furthermore, despite being the world’s second-largest economy, China would struggle to match the scale of US contributions. For example, while its pandemic-era vaccine diplomacy had both humanitarian and political motives, China’s total global health funding amounted to just 783 million USD in 2023, far short of the US’s 12.4 billion USD.

In conclusion, foreign aid has been recognised for its tendency to be used as a vehicle for projecting donor interests under the guise of development. While this can channel resources into underserved communities, it often means initiatives proceed on the donor’s strategic terms. Over time, this dynamic has driven the NGO-isation of social justice: causes once driven by volunteer networks become managed by professional NGOs dependent on external funding. In effect, power shifts from broader society to specific projects and donor priorities, raising questions about which voices truly shape the agenda. This moment forces us to rethink how all the work that was handled with the help of foreign aid can be sustained in its absence. Even if some stopgap measures are put in place to address the funding shortfall, the challenges are immense. Amidst these uncertainties, it is the poor and vulnerable communities that bear the brunt.

Sandunlekha Ekanayake is a Lecturer of English and Business Communication at the Faculty of Business, University of Moratuwa, Sri Lanka. She is also a research analyst at Muragala | Centre for Progressive Politics and Policy (CPPP), Sri Lanka.

Image source: https://bit.ly/4nfVRXr

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Notes
^[1] Sri Lanka Thriposha Limited (SLTL), formerly the Thriposha Program was launched in 1973 with assistance from the US-based CARE Humanitarian Organization.

^[2] The BBS is a Buddhist nationalist group which emerged during the postwar era, with a slogan that read “Protection of Buddhism for Future Generations”.

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