ROLE OF INTERNATIONAL FINANCIAL

INSTITUTIONS ON INDIAN ECONOMY:

PRESENTED BY:
NAINA GUPTA

INTERNATIONAL FINANCIAL
INSTITUTIONS:
International financial institutions (IFIs) are financial institutions that
have been established by more than one country, and hence are subjects
of international laws. Their owners or shareholders are generally national
governments, although other international institutions and other
organizations occasionally figure as shareholders. The most prominent IFIs
are creations of multiple nations, although some bilateral financial
institutions exist and are technically IFIs. Many of these are multilateral
development banks (MDB).

WHAT ARE INTERNATIONAL

FINANCIAL INSTITUTIONS (IFIS)?
World Bank Group (WBG):
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)
International Monetary Fund (IMF)
Regional development banks, such as:
African Development Bank (AFDB)
Asian Development Bank (ADB)

CONTINUED..
Inter-American Development Bank (IADB)
Bank of the South
European Bank for Reconstruction and Development (EBRD)

Other regional financial institutions e.g. European Investment Bank (EIB)

Export Credit Agencies of individual country governments, such as:
US Export Import Bank (EXIM)
Japan External Trade Organization
Hermes Kreditversicherungs (Germany)

INTERNATIONAL FINANCIAL
INSTITUTIONS:
Their common goal.
to reduce global poverty and improve people's living conditions

and standards;
to support sustainable economic, social and institutional
development; and
to promote regional cooperation and integration.

PLANS LED BY G-20

SUMMIT IN WASHINGTON
D.C:
1.
2.
3.

4.
5.
6.

World Bank Group (WBG)

International Monetary Fund
(IMF)
European Bank for
Reconstruction and
Development (EBRD)
Asian Development Bank (ADB)
African Development Bank
(AFDB)
Inter-American Development
Bank (IDB)

G20 leaders and delegates attend the Summit

on Financial Markets and the World Economy
Saturday at the National Building Museum in
Washington, D.C. on November 15, 2008.

World Bank

WORLD BANK GROUP:

The term "World Bank" generally refers to
just the IBRD and IDA
The World Bank's activities are focused
on developing countries, in fields such as
human development, agriculture and rural
development, environmental protection,
infrastructure, and governance.

It is concerned with assisting its member

countries to achieve sustained economic
growth. It functions as an intermediary for
the transfer of financial resources from the
more developed to the less developed
countries.

Formation- 27 December 1945

Type- International organization
Legal status- Treaty
Purpose/focus- Economic
development,
poverty elimination
Membership- 187 countries
President- Robert Zoellick
Jim Yong Kim (Elect)
Main organ- Board of Directors
Website- worldbank.org

ROLE OF WORLD BANK:

FIGHTS POVERTY BY OFFERING DEVELOPMENTAL ASSISTANCE TO
MIDDLE INCOME AND LOW INCOME COUNTRIES.
GIVE LOANS AND OFFERS ADVICE AND TRAINING IN BOTH THE
PRIVATE AND PUBLIC SECTORS.

AIMS TO ELIMINATE POVERTY BY HELPING PEOPLE HELP

THEMSELVES.
THE WORLD BANK GROUP CREATED A NEW $1.2 BILLION RAPID
FINANCING FACILITY- THE GLOBAL FOOD RESPONSE PROGRAM
(GFRP)- IN MAY 2008 TO SPEED ASSISTANCE TO THE NEEDIEST
COUNTRIES. GFRP HAS APPROVED AND BEGUN DISBURSING $200
MILLION IN 21 COUNTRIES.

THE WORLD BANK

GROUP

INTERNATIONAL BANK FOR

RECONSTRUCTION AND
DEVELOPMET (IBRD):
1.The International Bank for Reconstruction
and Development was established in 1945.
2. It had 184 members.
3. The IBRD is an international organization
whose original mission was to finance the
reconstruction of nations devastated by
World War II.
4. Now, its mission has expanded to fight
poverty by means of financing states.
5. Cumulative lending: $394 billion
6. Fiscal 2004 lending: $11 billion for 87 new
operations in 33 countries

INTERNATIONAL
DEVELOPMENT
ASSOCIATION (IDA):
1.The International Development Association
was established in September 24, 1960.
2. 165 Members is the part of the World Bank
that helps the worlds poorest countries.
3. IDA is responsible for providing long-term,
interest-free loans to the world's 80
poorest countries, 39 of which are in
Africa.
4. Fiscal 2004 commitments: $9 billion for
158 new operations in 62 countries

MULTILATERAL
INVESTMENT AND
GUARENTEE AGENCY
(MIGA):
1.

2.
3.

4.

The Multilateral Investment

Guarantee Agency was established
in 1988.
It had165 members.
Cumulative guarantees issued:
$13.5 billion (Amounts include funds
leveraged through the Cooperative
Underwriting Program).
Fiscal 2004 guarantees issued: $1.1
billion

INTERNATIONAL
FINANCE
CORPORATION (IFC):
1. The

International Finance
Corporation was established in
1956.
2. It had 176 members.
3. Committed portfolio: $23.5 billion
(includes $5.5 billion in syndicated
loans).
4. It promotes sustainable private
sector investment in developing
countries as a way to reduce
poverty and improve people's lives.
5. Fiscal 2004 commitments: $4.8
billion for 217 projects in 65
countries.

INTERNATIONAL CENTRE
FOR THE SETTLEMENT OF
INVESTMENT DISPUTES
(ICSID):
1.

2.
3.
4.

5.

The International Centre for

Settlement of Investment Disputes
was established in 1966.
It had 143 members.
Total cases registered: 159
It provides facilities for the
conciliation and arbitration of
investment disputes between
member countries and individual
investors.
Fiscal 2004 cases registered: 30

INTERNATIONAL MONETARY
FUND (IMF):
The International Monetary Fund was created
in 1944, with a goal to stabilize exchange rates and
supervise the reconstruction of the worlds
international payment system.
1- Promote international monetary cooperation.
2-Shorten the duration and lessen the degree of
disequilibrium in the international balances of
payments of members.
3-Facilitate the expansion and balanced growth of
international trade.
4-Promote Exchange stability and maintain orderly
exchange arrangements among members.
5-Assist in establishing a multilateral system of
payments.
The IMF provides financial assistance to members
to help them to correct balance of payments
problems in a manner that promotes sustained
growth.

International Monetary
Fund

Formation- Adopted: July 22, 1944

(67 years ago) Entered into force:
December 27, 1945
Type- International Economic Organization
Headquarters- Washington, D.C.
Membership- 1 nation (founding); 188
nations (to date)
Official languages- English, French, and
Spanish
Managing Director- Christine Lagarde
Main organ- Board of Governors
Website- www.imf.org

ROLE OF INTERNATIONAL
MONETARY FUND:

Involves the
monitoring of
economic and
financial
developments, and
the provision of
policy advice,
aimed especially at
crisis-prevention.

The IMF also lends to

countries with balance
of payments
difficulties, to provide
temporary financing
and to support polices
aimed at correcting the
underlying problems;
loans to low-income
countries are also
aimed especially at
poverty reduction.

The IMF provides

countries with
technical assistance
and training in its
areas of expertise.

BENEFITS TO INDIA BY IMF:

Freedom to Rupee

Membership of the World bank

Importance of India in international field

Technical advice and training

EUROPEAN BANK FOR RECONSTRUCTION

AND DEVELOPMENT (EBRD):
EBRD provide project financing for banks, industries and businesses, both new ventures and
investments in existing companies. We also work with publicly owned companies.
Founded in 1991
1- Financial institution investing in public and private sectors
2- Multinational shareholding: 60 countries, EIB and EU
3- Operates in 27 countries of Central and Eastern Europe and the former Soviet Union)
4- Institution with broader mandate: foster transition to market economy

ROLE OF EUROPEAN BANKS FOR

RECONSTRUCTION AND DEVELOPMENT:
Structuring the financing of municipal infrastructure, equipment and services
Promote commercialization and corporatization of services
Development of regulatory structures
Promotion of appropriate private sector involvement
Environmental improvement
Facilitate EU grant and commercial loan co-financing
EBRD assists in developing municipal creditworthiness and improving budgetary
and fiscal practice
EBRD mobilizes financing for municipal advisory services
Support in project appraisal and transaction structuring
Provide most appropriate financing structure from a wide array of financial instruments
Mobilization of co-financing and syndication

ASIAN DEVELOPMENT
BANK (ADB):

Asian Development Bank

The Asian Development Bank (ADB) is a regional

development bank established to facilitate economic
development of countries in Asia.
ITS STATED GOALS:
1- Promoting economic growth
2.Reducing poverty
3.Developing human resources
4.Improving the status of women
5.Protecting the environment
The Bank's operations cover a wide spectrum of
activities and have been classified according to the
following sectors:
1.Agriculture and natural resources
2.Transport and communications
3.Energy
4.Industry and non-fuel minerals
5.Finance
6.Socialinfrastructure

Motto- Fighting poverty in Asia and

the Pacific
Formation- 22 August 1966
Type- Regional organization
Legal status- Treaty
Purpose/focus- Crediting
Headquarters- Mandaluyong
City, Metro Manila, Philippines
Region served- Asia-Pacific
Membership- 67 countries
President- Haruhiko Kuroda
Main organ- Board of Directors
Staff- 2,500+
Website- http://www.adb.org

ROLE OF ASIAN DEVELOPMENT

BANK:
1- Provides loans and equity investments to its developing
member countries
2- Provides technical assistance for the planning and
execution of development projects and programs and for
advisory services
3-Promotes and facilitates investment of public and private
capital for development
4-Assists in coordinating development policies and plans of
its DMCs

African Development Bank

AFRICAN
DEVELOPMENT BANK
(AFDB):
Established in 1964 with a mandate to
promote economic and social development
in Africa, the African Development Bank is
a regional multilateral development
finance institution comprising the African
Development Bank, the African
Development Fund, and the Nigeria Trust
Fund. The opacity of its operations and its
emphasis on major regional infrastructure
projects have generated concern among
African and international civil society.

Formation

August 4, 1963

Type

International
organization

Legal status

Treaty

Purpose/focus

Regional
development

Membership

78 countries

President

Donald
Kaberuka

Main organ

Board of
Executive
Directors

Website

http://www.afd
b.org

ROLE OF AFRICAN
DEVELOPMENT BANK:
The main role of the African Development Bank is to help the

development of countries in Africa by making loans and equity

investments in various projects and programs.
African Development Bank also provides technical assistance on
development projects.
African Development Bank helps in coordinating the development
projects of the various countries involved.

Inter-American Development Bank

INTER-AMERICAN
DEVELOPMENT BANK
(IDB):
The Inter-American Development Bank was
founded in 1959. The IDB has 48 member
countries, including 26 Latin American and
Caribbean borrowing members. The bank
supports efforts by Latin America and the
Caribbean countries to
reduce Poverty and Inequality and is the largest
source of development financing in this area,
besides loans, grants are provided as well
as technical assistance and do research. The
IDB has a strong commitment to achieve
measurable results, increased integrity,
transparency and accountability.

Type

International
organization

Headquarters

Washington,
DC

Membership

48 countries

Official language English,

s
Spanish,
French,
Portuguese
President

Luis Alberto
Moreno

Main organ

Board of
Governors

Staff

About 2,000

Website

iadb.org

ROLE OF INTER-AMERICAN
DEVELOPMENT BANK:
1- Using its lending operations, regional initiatives, research and knowledge dissemination
activities, institutes, and programs, the IDB helps to foster sustainable economic and
social development in Latin America and the Caribbean.
2- Through its financing, the Bank prioritizes poverty reduction and social equity,
environmentally sustainable growth, modernization of the state, and regional
integration.
3- IDB has the following main areas of action:
Reducing poverty and social inequalities;
Addressing the needs of small and vulnerable countries;
Fostering development through the private sector;
Addressing climate change, renewable energy and environmental sustainability; and
Promoting regional cooperation and integration.

THANK YOU FOR YOUR KIND

ATTENTION