UNHCR fund cut: Refugee lifeline hangs by a thread in host nations

What adds to the plight of refugees in India is that the country, which is neither a signatory to the 1951 Refugee Convention nor its 1967 Protocol, provides limited protection to them

The UNHCR, or the worldwide refugee agency, is staring at a 66 per cent reduced global budget in 2025 as the Trump administration cuts aid, making things further worse for uprooted people worldwide. 

From a projected $5.17 billion in 2024, the agency’s funds for 2025 have dropped to just $1.75 billion, which is one of the sharpest contractions in its funding. 

For millions of refugees all over the world, the consequences will be immediate and far-reaching. But in countries such as India where the state does not have a formal legal framework to protect refugees, the effects may be especially acute. In India, the UNHCR supports over 47,000 refugees and asylum seekers. Many of them — including Rohingyas running away from repression in Myanmar and Afghans fleeing Taliban persecution — live without formal legal status and rely heavily on the agency for documentation, health care referrals, education support, and basic protections. But in 2025, even these fragile lifelines are at risk. 

UNHCR India’s financial requirement has fallen from $21.2 million in 2024 to $17.3 million for 2025. However, this does not reflect improved efficiency or reduced need — it’s a forced adjustment due to the anticipated donor shortfall. Even this reduced requirement faces a severe funding gap — as on March 31, only 25 per cent of the requirement was met, leaving a projected shortfall of $12.94 million, or roughly 75 per cent, which may or may not be bridged in coming months. 

For comparison, the agency operated in India with up to 60 per cent gap between the requirement and actual funding in both 2023 and 2024.  

But in absolute terms, the situation in 2025 is worse. In 2023 and 2024, there was a funding gap of about 60 per cent. However, the financial requirement for those years was $21.7 million, higher than the $17.3 million projected for 2025. As a result, despite the large proportion of the funding gap in 2023 and 2024, the amount received was higher than in 2025. 

Nowhere is this clearer than in the case of contributions from the United States (US). The US, the largest donor to the UNHCR, provided $2.05 billion globally in 2024.  

For 2025, that dipped to just $268 million, a nearly 87 per cent drop. In India, the US contribution stood at about $3.49 million in 2024. That is projected to fall to just $580,554 in 2025, a collapse of over 83 per cent. These cuts have caused layoffs at the UNHCR’s India office and are expected to lead to reduced field operations as reported by Business Standard recently. 

“This is a severe crisis,” said Rama Dwivedi, assistant external relations officer, UNHCR India.  

“We need to reduce expenditure to remain operational and financially stable in 2025 and beyond.” She noted the agency would need to prioritise the most vulnerable refugees, stateless persons, and displaced individuals — a form of triage that could leave thousands without services. There is also the additional factor that India, which is not a signatory to the 1951 Refugee Convention or its 1967 Protocol, provides limited protection to refugees. There is no national refugee law.  

Certain quarters, for example, label Rohingya Muslims “illegal immigrants” and as such they face detention or deportation despite being recognised as refugees under the UNHCR’s mandate. While India has historically hosted large refugee populations — including Tibetans, Sri Lankan Tamils, and, more recently, Afghans — its legal obligations remain unclear. The Supreme Court in various rulings such as Ktaer Abbas Habib Al Qutaifi versus Union of India, 1998, has ruled that the right to life under Article 21 of the Indian Constitution extends to refugees.  

However, without a codified legal framework, these rights are inconsistently enforced, and humanitarian protections rely heavily on the UNHCR’s presence. 

Sanjay K Bhardwaj of Jawaharlal Nehru University said the UNHCR’s downsizing could further destabilise the situation. 

“This would heighten refugee vulnerability and may drive some towards illegal activities.” 

He said the government must consider practical repatriation options — particularly for the Rohingyas — but added regional instability made such efforts difficult. Globally, the UNHCR is being forced into a strategic rethink. It is expected to move away from long-term integration and capacity-building programmes and instead focus primarily on life-saving interventions — food, shelter, and emergency health care.  

The agency’s global health budget is expected to fall by 87 per cent, putting an estimated 13 million displaced people at risk. In places like the Democratic Republic of the Congo, health clinics run by UNHCR partners have seen 70 per cent reduction in support.  

Similar contractions are anticipated in Asia. 

Filippo Grandi, the UN high commissioner for refugees, recently said the world was approaching “a breaking point in our ability to protect the displaced”. 

He warned that the scale of the cuts — and the speed with which they were occurring — threatened to unravel decades of progress in refugee protection and risk “millions of lives”. 

The situation poses difficult questions for host countries like India. Without additional international support or new national policies, the gaps left by the UNHCR could widen into crises. The limited gains made in integrating refugee communities could be reversed.