World Bank

Why in news?

• Recently, Indian American business executive Ajay Banga was nominated by US President to head the World Bank.
• He will be the first Indian-American to head either of the two top international financial institutions - the International Monetary Fund (IMF) and the World Bank.

About World Bank:

• It was created in 1944, as the International Bank for Reconstruction and Development (IBRD) along with the IMF.
• The IBRD later became the World Bank.
• The World Bank Group is a unique global partnership of five institutions:
  • International Bank for Reconstruction and Development (IBRD)
  • International Development Association (IDA)
  • International Finance Corporation (IFC).
  • Multilateral Guarantee Agency (MIGA)
  • International Centre for the Settlement of Investment Disputes (ICSID)
• India is a member of all but ICSID.
• The World Bank is one of the United Nations' specialized agencies.

Members:

• It has 189 member countries.
• India is also a member country.

Shareholding of World Bank:

• The United States is the largest single shareholder, with 16.41% of the votes, followed by Japan (7.87%), Germany (4.49%), the United Kingdom (4.31%), and France (4.31%). The rest of the shares are divided among the other member countries.

World Bank v/s IMF:

• While the World Bank provides support to developing countries, the IMF aims to stabilize the international monetary system and monitors the world’s currencies.

PRACTICE QUESTION

Consider the following statements:

1. United States is the largest shareholder in World Bank

2. India is a member of all the five institutions under the World Bank

Which of the statements given above is/are correct?

(a) 1 only

(b) 2 only

(c) Both 1 and 2

(d) Neither 1 nor 2

Answer