The now largely forgotten book Asian Drama: An Inquiry into the Poverty of Nations by Swedish social scientist Gunnar Myrdal was published in 1968. Myrdal called his book “Asian Drama” because of the tensions he saw being played out in Asia between modern ideals and the traditional. But there was another drama too— the tension being played out, within the ‘modern project’, between the different economic strategies that were on offer. It is this particular drama that Tim Lankester focuses on in the context of India and Indonesia over the three decades from the mid–1960s. And for both these populous countries, there are dramas still to be played out. Both countries have new elected governments this year, and growth prospects of their economies largely will depend on to what extent remaining reform and governance issues are tackled.

This article describes the main reasons why aid has not been as effective at addressing the world’s poverty problem as it could have been: lack of will on the part of donors, inadequate policies and governance on the part of recipients, and a lack of understanding of development and of how aid works best. It goes on to argue that donors and recipients alike are now better positioned to make aid more effective. However, the current and prospective level of aid is inadequate for the achievement of the Millennium Development Goals. While the moral case for more aid is compelling, it remains to be seen when and whether this will lead to larger aid budgets.