International Development Secretary Andrew Mitchell has revealed that direct development aid to 16 countries, including Russia and China, will be cut to provide more aid to war-torn countries such as Afghanistan.
Aid spending in India will be frozen at its current level for four years and focused on three of the nation's poorest states, Mr Mitchell added.
In a Commons statement on 1 March 2011, Mr Mitchell also told MPs that the government will save more than £50m by cutting development funding to four United Nations organisations: the United Nations Industrial Development Organization, UN-Habitat, the UN agency the International Labour Organization (ILO), and the UN International Strategy for Disaster Reduction.
Mr Mitchell told MPs that they had "performed poorly or failed to demonstrate relevance".
Unesco - the UN's cultural arm - was being placed in to "special measures", meaning it would have to "improve its performance as a matter of urgency" in the next two years or see its funding cut.
Meanwhile, the UN Development Programme and World Health Organisation would be subject to "specific pressure" from the government to implement a series of "reforms and improvements" if they want to continue receiving British money.
"Aid can perform miracles but it must be well spent and properly targeted," Mr Mitchell said.
But shadow international development secretary and Labour deputy leader Harriet Harman called on Mr Mitchell to reconsider his decision on the ILO.
She urged him to "admit that there is nothing new about ending significant bilateral aid to Russia".
Ms Harman said: "We ended it in 2007. Grand gestures of shutting down already closed programmes create a misleading picture of our aid programme and undermines rather than supports it."
Mr Mitchell rejected the charge, telling MPs that he wanted to "make it clear that I have cut back the programmes in Russia and China that we inherited" from the previous Labour government.
He also later clarified that the UK would not be withdrawing its membership of the ILO, and the subscription fees would continue to be paid by the Department for Work and Pensions.
However, the government would make no further "voluntary contributions" to its development programmes, Mr Mitchell said.