New Delhi, Feb. 3 -- When Finance Minister Nirmala Sitharaman presented India's 2026-27 Budget, the headline themes were familiar: fiscal consolidation, steady infrastructure spending, and the promise of "incremental reform" amid global uncertainty. But buried in the fine print of external assistance and overseas infrastructure allocations lies a quieter, more revealing story-one about India's narrowing foreign policy bandwidth and the growing constraints to strategic ambitions.

Two decisions stand out. New Delhi has halved its aid allocation to Bangladesh, cutting it to Rs.60 crore, after spending less than a third of the Rs.120 crore earmarked in the previous financial year. Simultaneously, for the first time in nearly a decade, India ...