Rival to World Bank, with India equal role

[danish_vij]

New Delhi, Sept. 7: India has convinced China and three other emerging economies to create a rival to the 68-year-old World Bank with equal contributions from the five members, rejecting Beijing’s proposal to give more than the rest which would have allowed it to dominate the institution.

The New Development Bank, as the initiative by Brazil, Russia, India, China and South Africa will be called, will start with a capital of $50 billion. The five nations took the decision on the sidelines of the G20 summit near St Petersburg, which was attended by Prime Minister Manmohan Singh.

The rejection of China’s proposal comes after months of quiet but persistent Indian lobbying with the other members of BRICS, as the five-nation grouping is called. Eventually, this resulted in an agreement during the global conclave in Russia, senior Indian officials told The Telegraph.

“We just couldn’t agree to a development bank dominated by one country,” an official said. “That would have ended up being no different from the institutions and financial systems the New Development Bank is trying to present an alternative to.”

Although differences between the BRICS countries persist on elements of the bank’s future and even its location, these nations see the institution as a key component of an alternative to the West-dominated financial system put in place after the Second World War.

While India and other BRICS countries have turned to the World Bank and the International Monetary Fund for assistance in the past, developing nations have frequently complained about the perceived hegemony of the US and other developed nations over these institutions.

In Durban in March, the five nations — home to about 3 billion people or 40 per cent of the world’s population — had decided on a Contingent Reserve Agreement. Under this, they were to create a $100-billion fund that each member could dip into during financial emergencies.

Loosely a BRICS parallel to the International Monetary Fund, the reserve will have differential capital put in by the various members. China, by far the largest of the BRICS economies, will pitch in with $41 billion; Russia, Brazil and India will each contribute $18 billion; and South Africa will give $5 billion.

But unlike the development bank, the contingency reserve did not become the focus of diplomatic tussles. Only the five members can dip into it, and it needs no physical infrastructure — the central bank of each BRICS nation will simply set aside its contribution.

In contrast, the development bank, first pitched formally a year ago, can emerge as an actual rival to the World Bank because all countries, especially other nations in the developing world, can seek assistance from it.

“The development bank is a diplomatic tool to raise the global influence of the BRICS countries,” a Brazilian diplomat in New Delhi said.

When China proposed an initial capital of $100 billion for the development bank, of which it was willing to contribute half, India opposed the move. Over the past six months, India worked to bring the other BRICS nations on its side, officials said.

Russia was the first to be persuaded, followed by Brazil. South Africa, which has the smallest economy among the grouping’s members, eventually came on board. Each member will now contribute $10 billion for an overall capital of $50 billion.

But differences remain over the leadership structure of the bank, and over who will host its headquarters.
http://www.telegraphindia.com/1130908/jsp/nation/story_17325638.jsp#.UiwyfNIweY0

 

[Masters]

Without China, there is no BRICS.

We can and we will impose our weight on the BRICS.

Why? Because we can.

Our economy is bigger than the other BRICS combined. Without our approval, nothing gets done in the BRICS.

We contributed 41% to the new fund. That's basically half the allocation. We have the economic and financial might to get whatever we damn well want. The headquarters will be located in either Hong Kong or Shanghai.

India has zero influence in the BRICS. Any proposal needs our approval because of our size and importance. As I said, without us, no one would give a rats arse about the other BRICS countries which are economically failing as we speak.

 

[danish_vij]

Without China, there is no BRICS.

We can and we will impose our weight on the BRICS.

Why? Because we can.

Our economy is bigger than the other BRICS combined. Without our approval, nothing gets done in the BRICS.

We contributed 41% to the new fund. That's basically half the allocation. We have the economic and financial might to get whatever we damn well want. The headquarters will be located in either Hong Kong or Shanghai.

India has zero influence in the BRICS. Any proposal needs our approval because of our size and importance. As I said, without us, no one would give a rats arse about the other BRICS countries which are economically failing as we speak.

ohh!! LORD CHINA PARDON ME!!
please lord spoil other threads!

 

[GR!FF!N]

Without China, there is no BRICS.

We can and we will impose our weight on the BRICS.

Why? Because we can.

Our economy is bigger than the other BRICS combined. Without our approval, nothing gets done in the BRICS.

We contributed 41% to the new fund. That's basically half the allocation. We have the economic and financial might to get whatever we damn well want. The headquarters will be located in either Hong Kong or Shanghai.

India has zero influence in the BRICS. Any proposal needs our approval because of our size and importance. As I said, without us, no one would give a rats arse about the other BRICS countries which are economically failing as we speak.

Please Read the news and then comment O Lord...

If China is so Powerful,then create your own group..No need to stay in BRICS..we can help ourselves in BRIS...

 

[Masters]

Please Read the news and then comment O Lord...

If China is so Powerful,then create your own group..No need to stay in BRICS..we can help ourselves in BRIS...

You help?

Here you are coming in begging bowls to beg for money to save your collapse currency and you pretend you can help others.

India has reserves to cover only 7 months of imports.

 

[GR!FF!N]

You help?

Here you are coming in begging bowls to beg for money to save your collapse currency and you pretend you can help others.

India has reserves to cover only 7 months of imports.

and here comes the troll...

Begging bowls???that bank willn't be operational till 2015..why don't you go and read the article properly before post here for mental handj0b????

by the way,why don't China go to some bigger leagues than stay with Beggars???

 

[danish_vij]

Without China, there is no BRICS.

We can and we will impose our weight on the BRICS.

Why? Because we can.

Our economy is bigger than the other BRICS combined. Without our approval, nothing gets done in the BRICS.

We contributed 41% to the new fund. That's basically half the allocation. We have the economic and financial might to get whatever we damn well want. The headquarters will be located in either Hong Kong or Shanghai.

India has zero influence in the BRICS. Any proposal needs our approval because of our size and importance. As I said, without us, no one would give a rats arse about the other BRICS countries which are economically failing as we speak.

 

[MohitV]

another new chinese troll with his high IQ......where is PDF heading to

 

[navtrek]

Without China, there is no BRICS.

We can and we will impose our weight on the BRICS.

Why? Because we can.

Our economy is bigger than the other BRICS combined. Without our approval, nothing gets done in the BRICS.

We contributed 41% to the new fund. That's basically half the allocation. We have the economic and financial might to get whatever we damn well want. The headquarters will be located in either Hong Kong or Shanghai.

India has zero influence in the BRICS. Any proposal needs our approval because of our size and importance. As I said, without us, no one would give a rats arse about the other BRICS countries which are economically failing as we speak.

Buddy why so much anti India sentiment ?? dont just type in what ever you wish. All login to defence.pk to have a fruitful discussion or a conversation on issues.

SO STOP TROLLING! contribute if you have something valid.....

 

[StarCraft_ZT]

When China proposed an initial capital of $100 billion for the development bank, of which it was willing to contribute half, India opposed the move. Over the past six months, India worked to bring the other BRICS nations on its side, officials said.

This is exactly India's way----we won't let others to succeed, even if we are not successful. India wants to dominate this development bank while itself has no such strength to achieve its goal. China has more fund to bring this bank into efficient operation, more fund means more responsibility, we would like to undertake much more responsibility to save emerging markets. Typically India way, drag you down with shady approach.

 

[Genesis]

lol please don't say BRIS, do you know what Bris is? lol

Anyways, I don't see this bank doing too much. BRICS still can't rival even US alone, much less all the developed world. This bank would be good for China to try our hand in a group that could potentially do a little something with a equal say. This would be good opportunity for us.

It's tough to say what will happen in a decade when China is very close or already passed US economy, tough to see what China will find ourselves in. So I don't place too much importance on this group.

Another factor to consider is we are the leading expert in developing all sorts of infrastructure and could use this opportunity to get into more and more developing country, to lay the foundation for more influence.

 

[xunzi]

I can see the trouble with opposing China's proposal. I mean to be serious with the New Development Bank, the fund needs at least $500 billion to be a serious candidate for IMF or World Bank with each total reserve fund conservatively in the $800 billion.

The problem is South Africa is too economic inferior to continue contributing equal amount when more fund is needed in the future. Will South Africa willing to fork out $100 billion, as opposes to a mere $10 billion? I don't see much future in the new bank, unless China is allowed to contribute more, to be a serious contender for IMF/World Bank.

 

[GR!FF!N]

When China proposed an initial capital of $100 billion for the development bank, of which it was willing to contribute half, India opposed the move. Over the past six months, India worked to bring the other BRICS nations on its side, officials said.

This is exactly India's way----we won't let others to succeed, even if we are not successful. India wants to dominate this development bank while itself has no such strength to achieve its goal. China has more fund to bring this bank into efficient operation, more fund means more responsibility, we would like to undertake much more responsibility to save emerging markets. Typically India way, drag you down with shady approach.

a group like BRICS means equality..China may have more wealth than others,but BRICS wasn't created for China's wealth,right??tell me,then what South Africa,whose economy is lesser than all other members,have to contribute???a mere $5 bil will make him a lesser member of this group..

BRICS stands for co-op,not domination..its a good idea to contribute equal amount of money,cause money talks..the member which will provide more money will try to reap benefit more..

and BRICS bank can't be a contender of World Bank..cause only member of this bank will be these 5 countries..it is as simple as that..

 

[Srinivas]

As per the report BRICS Bank is gone, new bank is emerging which may not have chinese influence.

With the economy of China in some transformation it is not possible for china to exert influence.

Without China, there is no BRICS.

We can and we will impose our weight on the BRICS.

Why? Because we can.

Our economy is bigger than the other BRICS combined. Without our approval, nothing gets done in the BRICS.

We contributed 41% to the new fund. That's basically half the allocation. We have the economic and financial might to get whatever we damn well want. The headquarters will be located in either Hong Kong or Shanghai.

India has zero influence in the BRICS. Any proposal needs our approval because of our size and importance. As I said, without us, no one would give a rats arse about the other BRICS countries which are economically failing as we speak.

Truth is that Chinese can do what ever they want, India will pursue its own goals in ASEAN,South America and Africa.

When China proposed an initial capital of $100 billion for the development bank, of which it was willing to contribute half, India opposed the move. Over the past six months, India worked to bring the other BRICS nations on its side, officials said.

This is exactly India's way----we won't let others to succeed, even if we are not successful. India wants to dominate this development bank while itself has no such strength to achieve its goal. China has more fund to bring this bank into efficient operation, more fund means more responsibility, we would like to undertake much more responsibility to save emerging markets. Typically India way, drag you down with shady approach.

 

[xunzi]

a group like BRICS means equality..China may have more wealth than others,but BRICS wasn't created for China's wealth,right??tell me,then what South Africa,whose economy is lesser than all other members,have to contribute???a mere $5 bil will make him a lesser member of this group..

BRICS stands for co-op,not domination..its a good idea to contribute equal amount of money,cause money talks..the member which will provide more money will try to reap benefit more..

We UNDERSTAND this! Trust me. We understand that equality is needed, that's why we accept the initiative of equal contribution. But for future projection, it won't rival the IMF. It will be a "niche" bank for any country that doesn't meet the IMF's requirement can seek alternative fund, albeit at much lesser loan. In other words, if the BRICS's New Development Bank are serious about competing against IMF, it must accepts one way or the other, either allow China unlimited contribution to the fund or fork out 10x more, in which I don't see South Africa can afford. So what is the solution?