Wow, India HAS come a long way. I am glad to hear this!
It has come a long way. However, it is so big with so many people that foreign aid never amounted to much. Plus a lot of foreign aid is in the form of loans, which India always repays. As a result, it isn't unusual for India to have net negative foreign aid, spending more money paying back aid loans than what it takes in.
I doubt that having money pour into government helps that country's people. The oil states are the great examples of this. Yes, there is still great poverty in much of India, but the same can be said of Saudi Arabia, and guess which country has better long-range prospects.
India's prime minister talks a lot like one of our moderate Democrats, but he is an econmic realist who undoubtedly knows that foreign aid doesn't really help a country's economy.