Ministers report the funding will go toward ensuring taxpayer-funded aid projects also promote religious diversity.
They say a key focus of the Coalition for Religious Equality and Inclusive Development programme will be teaching children to respect people who follow other faiths.
The Christian politician Jim Shannon - chair of the All Party Parliamentary Group on Freedom of Religion and Belief - told Premier he was "very pleased" by the announcement.
The DUP MP added that religious liberty should go hand-in-hand with foreign aid: "We should be tying in the issue of freedom of religious belief not necessarily [as] a condition [of aid] but part of our influence that we can use.
"It's getting those words into action. I think all ministers are doing that."
UK aid worth hundreds of millions of pounds is received every year by countries including Pakistan, Nigeria and Afghanistan - nations which have questionable records when it comes to religious freedoms.
UK aid provides funding for food in Juba in Sudan
The Prime Minister's Special Envoy for Freedom of Religion or Belief, Lord Tariq Ahmad of Wimbledon (pictured) said: "This money will go a long way in bolstering the work of civil society and NGOs to promote respect, and the value of religious diversity and tolerance.
"It will sit alongside the excellent work British diplomats do in flying the flag for human rights."
The programme will be funded via UK Aid Connect, part of the Department for International Development. Faith groups, non-governmental groups and academics will be involved.
International Development Minister Lord Bates said: "Young people are key to creating a better, more tolerant world.
"As part of this announcement Her Majesty's Goverment's Respect in Education will receive increased funding so that schools in the world's poorest countries can teach more children about respect for religious diversity."
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