Global Indian News
The China-backed Asian Infrastructure Investment Bank (AIIB) has agreed to jointly finance a major new highway in Pakistan in its first co-financed project with the Asia Development Bank (ADB). …
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In another disappointing news for global markets, the world’s second largest economy recorded its lowest growth rate in 25 years. China’s economy grew 6.9 per cent in 2015, missing the …
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China’s President Xi Jinping has launched the Asian Infrastructure Investment Bank (AIIB), an international development bank seen as a rival to the Bretton Woods institutions like the World Bank. With …
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Japanese Prime Minister Shinzo Abe’s recent lightning visit to five Central Asian countries and Mongolia forms a landmark in Japan’s Eurasian diplomacy. No other Japanese Prime Minister had ever visited …
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With the Asian continent in the midst of unprecedented economic growth, the need for developing infrastructure facilities has mounted beyond all expectations. As the two biggest Asian economies, China …
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It seems to be a golden period for China with yet another non-Bretton Woods institution challenging the West-dominated international financial institutions which have controlled the global financial system post 1945. Two days after 50 countries signed on to become members of the China-led Asian Infrastructure Investment Bank, the Chinese Parliament has ratified the creation of the New Development Bank of BRICS countries. The parliaments of India and Russia have already ratified the NDB, which will be headquartered in Shanghai, and will have an Indian as the CEO of the newly created institution.
With the setting up of these two banks, China has scored a point against the US and the West which have been ignoring the BRICS’ appeal for greater voting rights in the IMF and reform of global financial governance system. The NDB’s shareholding is on an equitable basis, with China, India, Brazil and South Africa contributing 20 per cent of the start-up capital of $50 billion, with a goal to reach a capitalization of US$100 billion.
The formal launch of NDB and AIIB is set to recast global financial landscape. Some will contend that 2015 seems to be the year of China when it became a game changer by hosting two new multilateral banks of the global South.
Moving beyond the construction of rivalry between the two Asian giants, India has emerged as the second largest shareholder in the China-led Asian Infrastructure Investment Bank (AIIB), which is expected to provide development finance to Asia’s third largest economy which needs at least $1 trillion to bolster its infrastructure.
The 60-article agreement specifies structure and policy-making mechanism, as well as its member’s shares in the bank. The AIIB will have authorized capital of $100 billion, with Asian countries contributing up to 75 per cent of the total capital.
The delegates from 50 member countries gathered at the majestic Great Hall of the People in Beijing on June 29 to sign an agreement, providing the legal framework for the China-led Asian Infrastructure Investment Bank (AIIB), which is seen as a rival to the world’s major financial institutions, including the World Bank and Asian Development Bank.
Seven more countries are due to sign by the end of the year. For India, its ambassador to China Ashok Kantha signed the document.
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