Aid, or Official Developmental Assistance (ODA), is an integral part of the Asia-Pacific regional architecture, particularly in South East Asia which is reliant on developmental finance to meet its growing economic needs. In the last decade or so there has been a shift in the scope of who provides this ‘aid’. Earlier there were ‘traditional’ donors who are the Developmental Assistance Committee (DAC) donors which are developed and industrialised countries. With the emerging of countries like China and India as strong economic and growth partners in the region, there has been an entry of ‘non-traditional’ donors who are usually developing countries on their own. Amidst the Quad, there lies a strategic promise of promoting open and transparent economic architecture in the Indo-Pacific region, with three of its members being traditional donors (Australia, Japan and the United States) and India, itself a developing country, a non-traditional donor.

So far, donors in the region both traditional and nontraditional have shown a competitive aid agenda rather than a cooperative due to conflicting geopolitical interests in the region. With the Quad coming together as a regional grouping based on their democratic values and a focus on strengthening the rules-based order in the region, it makes sense for them to cooperate on a development agenda for the region too. The Quad’s security and prosperity are interlinked as it has shown through its drive to provide public goods like vaccine and technology sharing in the region. More strategically, a coordinated approach to fulfil the economic needs of the region will also provide a counter to China’s Belt and Road Initiative (BRI).

The Quad will be well placed to provide efficient and transparent economic assistance as it consists of countries of various levels of development, and this can promote sustainable practices in the developmental agenda for the Indo-Pacific. For a truly FOIP (free and open Indo-Pacific) approach for a coordinated developmental agenda, development assistance should be provided in ways that build, and do not inadvertently undermine, recipient countries’ sustainable capacity to develop, implement and account for these policies to their people and legislature.  With the current pattern of financing under the BRI, there have been claims that this kind of assistance has been unsustainable both at an economic level as well environmental level.

A key issue the Quad is facing for the region is also to engage the only country within the grouping that is geographically not in region—the United States. An increased presence of the US in the region as a donor to balance multilateral institutionalism and highlight ‘good practices’ of aid will also boost the credibility of the Quad as well as provide a stronger strategic balance to the BRI.

As a non-traditional donor, China’s increased presence, especially through its State Owned Enterprises (SOEs) has grown in South East Asia. The Lancang-Mekong Cooperation is one such example of China setting up its own aid norms in the South East Asian region in 2016. Arguably, this has set up a divide in the ASEAN region between the mainland and maritime countries. This is a principal challenge to established norms of regional multilateralism and as China’s aid and development financing grows, there are chances that this challenge will also grow.

The US needs to step up its economic presence in the region, although there is cautious optimism on this front as the Biden administration launched the US-Mekong Partnership in 2020. However, this partnership does not involve the ASEAN directly, this would give the Quad an opportunity to directly engage with ASEAN, a political entity that has been wary of the Quad since its formation. I propose that ASEAN would value support delivered through ASEAN’s own institutions, rather than “unilaterally” through US regional programs, and a regional grouping like Quad would be more acceptable than a unilateral donor dictating the terms and conditions of economic assistance.  

Assistance and cooperation provided by like-minded countries such as those within the Quad could provide the region a viable alternative to the BRI development financing that has so far been the only option for the developing needs of the region. It would be a useful strategic alternative to the growing economic presence of China in the region and also fulfill the economic needs of the region. 


Dr Teesta Prakash is a Research Associate for the Southeast Asia Program at the Lowy Institute.

This article is a product of the Griffith Asia Institute’s recent Australia-Japan-India Trilateral which was supported by the Ministry of Foreign Affairs Japan.