The UK is to stop direct aid to 16 countries, including Russia, China and Iraq, papers seen by the BBC suggest.
A draft copy of a government review of its £7.8bn overseas aid budget - to be published this week - also reveals assistance for India will be frozen.
But, overall, the international development budget will rise by a third in this parliament, it says.
International Development Secretary Andrew Mitchell said spending would be a "good deal better focused".
The government's draft report states that aid spending is good for Britain's economy and safety.
It also outlines plans for greater transparency and accountability, with an emphasis on funding programmes that deliver greater results and which, specifically, help girls and women.
Resources will be concentrated on the 27 countries that account for three-quarters of the world's maternal mortality and malaria deaths, such as Ghana and Afghanistan.
By 2014, 30% of UK aid is expected to go to war-torn and unstable countries.
India is currently one of the biggest recipients of UK development aid, and there have been media campaigns in the UK suggesting an economy growing at nearly 10% a year simply does not need British assistance.
But others point out that nearly half a billion people in India are still desperately poor, and efforts to reduce global poverty will not progress without significant aid.
Mr Mitchell told BBC One's Politics Show: "The fact is that, if we want to reach our Millennium Development Goals, which we have set for 2015, we have to operate where poverty is greatest.
"We think that the international aid projects can be a good deal better focused."
Mr Mitchell said there were no plans at present to supply aid to Libya, as the country, while in political turmoil, was not facing a "humanitarian crisis".
But supplies would be available at "six hours' notice", if needed, he added.
While other departments saw their budgets cut in last autumn's spending review, the Department for International Development was spared.
However, Labour claims it has had to contribute to areas outside its remit, including picking up £2m of the bill for the Pope's visit to the UK last year.
Shadow international development secretary Harriet Harman said: "We don't either want to see them subsuming aid activities into military activities and neither do we want to see other government departments that are feeling the spending squeeze using the Department for International Development as the hole-in-the-wall like they did for getting money for the Pope's visit."
On Saturday, it emerged that the UK is threatening to switch funding away from the UN Food and Agriculture Organization - which focuses on longer-term projects, such as providing seeds and tools for agriculture - unless its performance improves.
Instead, more funding could go to the World Food Programme, which deals with emergency food aid around the globe.