World Bank snippets

The World Bank, the premier poverty fighting institution owned by 186 countries, has decided to give more say to developing nations—including India—through increased voting powers and a $86-billion hike in its share capital. The World Bank has allowed for a change in voting rights for different countries, making India the seventh largest shareholder in the institution. At the spring meeting of the World Bank-International Monetary Fund in Washington, the member countries have agreed to increase India’s voting power from 2.77% to 2.91%. China’s quota saw a far greater increase to 4.42% from 2.77%. As a group, developing and transition countries (DTCs) will get 3.13% higher voting rights, a release from the World Bank said. As a result of the increase in total capital base that would allow the agency to lend an additional $86 billion, India would also be able to get between $7 billion and $10 billion more in the coming years from the World Bank. While voting rights of countries like India, China, Brazil, Indonesia, Mexico and Turkey have increased, that of some of the major European and other countries that have traditionally dominated international finance like UK, France, Germany, the Nordic and Benelux countries, Japan, Australia and Canada, have gone down. While India becomes the seventh largest shareholder, China will become the third biggest shareholder of the World Bank, behind the US and Japan but ahead of Germany. US, the largest shareholder in the multilateral funding agency, currently holds 15.85%, followed by Japan (6.84%), China (4.42%), Germany (4%), France (3.75%), the UK (3.75%) and India (2.91%. The World Bank-IMF concluded their annual spring meeting with an overall shift of 3% voting rights to developing countries bringing their total voting rights to 47%. As a result of these changes, India is now ahead of Russia, Canada, Australia, Italy and Saudi Arabia in terms of voting power. India’s increase in shareholding is a reversal of the declining trend that the country had been witnessing since 1970.

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