Point-wise notes on the World Bank Group for UPSC Prelims:
1. Formation:
- Year: Established in 1944.
- Purpose: To provide financial and technical assistance for development projects in developing countries.
2. Structure:
- Five Institutions:
- International Bank for Reconstruction and Development (IBRD).
- International Development Association (IDA).
- International Finance Corporation (IFC).
- Multilateral Investment Guarantee Agency (MIGA).
- International Centre for Settlement of Investment Disputes (ICSID).
3. Objectives:
- Poverty Alleviation: Focus on reducing poverty in developing nations.
- Infrastructure Development: Support projects in areas like education, health, and infrastructure.
- Capacity Building: Enhance institutional and human capacity in recipient countries.
4. International Bank for Reconstruction and Development (IBRD):
- Purpose: Provides loans to middle-income and creditworthy low-income countries.
- Focus: Infrastructure and development projects.
5. International Development Association (IDA):
- Purpose: Provides concessional loans and grants to the world's poorest countries.
- Focus: Projects with a high impact on poverty reduction.
6. International Finance Corporation (IFC):
- Purpose: Promotes private sector investment in developing countries.
- Focus: Supporting private businesses, especially in infrastructure and finance.
7. Multilateral Investment Guarantee Agency (MIGA):
- Purpose: Provides political risk insurance and credit enhancement to encourage foreign investment.
- Focus: Mitigating risks for investors in developing countries.
8. International Centre for Settlement of Investment Disputes (ICSID):
- Purpose: Facilitates arbitration and conciliation of investment disputes between governments and foreign investors.
- Role: Ensures fair and unbiased resolution of investment-related conflicts.
9. Governance:
- Voting Power: Shares based on financial contributions, but reforms aim to give more voice to developing nations.
- President: Traditionally from the United States.
10. Challenges and Criticisms:
- Conditionality: Criticized for imposing strict conditions on borrowing countries.
- Governance Structure: Calls for reforms to better represent the changing global economic landscape.
Understanding the structure and objectives of the World Bank Group is crucial for aspirants preparing for UPSC Prelims.& mains.
