World Bank

What is the World Bank?

 The World Bank is an internationally supported bank that
provides financial and technical assistance to developing
countries for development programs (e.g. bridges, roads,
schools, etc.) with the stated goal of reducing poverty.

 The World Bank was formally established on December

27, 1945. The concept was originally conceived in July 1944
at the United Nations Monetary and Financial Conference.

 The Board of Executive Directors and the President of the

World Bank are responsible for the conduct of the general
operations of the Bank, oversee the Bank on a daily
basis,& perform their duties under powers delegated to
them by the Board of Governors. The Directors meet twice
a week in Washington,D.C, to approve new loans and
review bank operations and policies.
 History
 The World Bank is one of the two Bretton Woods
Institutions which were created in 1944 to rebuild
a war-torn Europe after World War II. Later,
largely due to the contributions of the Marshall
Plan, the World Bank was forced to find a new
area in which to focus its efforts.

 Subsequently, it began attempting to rebuild the

infrastructure of Europe's former colonies. Since
then it has made a variety of changes regarding its
focus and goals.

 From 1968-1981 it focused largely on poverty

alleviation. From the '80s and into the 1990s its
main focus was both debt management and
structural adjustment  
 Bretton Woods conference, was a gathering of
730 delegates from all 44 Allied nations at the
Mount Washington Hotel, situated in Bretton
Woods, New Hampshire to regulate the
international monetary and financial order after
the conclusion of World War II.
  The Marshall Plan (from its enactment,
officially the European Recovery Program,
ERP) was the primary plan of the United States
for rebuilding and creating a stronger foundation
for the allied countries of Europe, and repelling
communism after World War II.
 Members

 The
International Bank for Reconstruction and Deve
lopment
(IBRD) has 185 member countries, while the
International Development Association (IDA)
has 167 members.
 Each member state of IBRD should be also a
member of the International Monetary Fund
(IMF) and only members of IBRD are allowed
to join other institutions within the Bank (such
as IDA).
 Activities
 The World Bank's current focus is on the
achievement of the Millennium Development Goals
(MDGs), goals calling for the elimination of poverty
and the implementation of sustainable development.
Of the two constituent parts of the Bank, the IBRD
lends primarily to "middle-income countries" at
interest;while the IDA provides low or no interest
loans and grants to low income countries with little or
no access to international credit markets
The World Bank sees the five key factors necessary for economic growth and the
creation of an enabling business environment as:

 Build capacity – Strengthening governments and educating government officials

 Infrastructure creation – implementation of legal and judicial systems for the

encouragement of business, the protection of individual and property rights and
the honoring of contracts

 Development of Financial Systems – the establishment of strong systems capable

of supporting endeavors from micro credit* to the financing of larger corporate
ventures.
*Microcredit is the extension of very small loans (microloans) to the unemployed,
to poor entrepreneur and to others living in poverty who are not
considered bankable

 Combating corruption – Support for countries' efforts at eradicating corruption

 Research, Consultancy and Training - the World Bank provides platform for
research on development issues, consultancy and conduct training programs
(web based, on line, video/tele conferencing and class room based) open for
those who are interested from academia, students, government and
non-governmental organization (NGO) officers etc
 Funding
 The Bank obtains funding for its operations primarily
through the IBRD’s sale of AAA-rated bonds in the
world’s financial markets. The IBRD’s income is
generated from its lending activities, with its
borrowings leveraging its own paid-in capital, plus
the investment of its "float".
 The IDA obtains the majority of its funds from forty
donor countries who replenish the bank’s funds every
three years, and from loan repayments, which then
become available for re-lending
 Leadership
 The President of the Bank, currently
Robert B. Zoellick (ex-president
James D. Wolfensohn), is responsible
for chairing the meetings of the Boards
of Directors and for overall
management of the Bank.
 The Executive Directors make up the
Board of Directors, usually meeting
twice a week to oversee activities such
as the approval of loans and
guarantees, new policies, the
administrative budget, country
assistance strategies and borrowing
and financing decisions.
 The Vice Presidents of the Bank are its principal
managers, in charge of regions, sectors, networks and
functions. There are 24 Vice-Presidents, 3 Senior
Vice Presidents and 2 Executive Vice Presidents

 According to the Articles of Agreement, the five

largest shareholders, France, Germany, Japan, UK &
the USA, each appoint an executive director, while
other member states are represented by 19 executive
directors who represent constituencies in several
countries . Each director is elected by a country or a
group of countries every two years.
 World Bank Inspection Panel
 It is an independent panel that was established
in September 1993 to help ensure that their
operations adhere to their operational policies
and procedures. The panel allows people who
think they may have been adversely affected
by a bank-supported project projects to ask for
an investigation, which is called a request for
inspection.
 Areas of Operations
The World Bank is active in the following areas

Agriculture and Rural Development 
Law and Justice

Conflict and Development 
Macroeconomic and Economic Growth

Development Operations and 
Mining
Activities 
Poverty Reduction

Economic Policy 
Poverty

Education 
Private Sector

Energy 
Public Sector Governance

Environment 
Rural Development

Financial Sector 
Social Development

Gender 
Social Protection

Governance 
Trade

Health, Nutrition and Population 
Transport

Industry 
Urban Development

Information and Communication 
Water Resources
Technologies 
Water Supply and Sanitation

Information, Computing and
Telecommunications

International Economics and Trade

 Criticism
 Some critics of the World Bank
believe that the institution was not
started in order to reduce poverty but
rather to support United States'
business interests, and argue that the
bank has actually increased poverty
and been detrimental to
the environment, public health, and
cultural diversity. Some critics also
claim that the World Bank has
consistently pushed a "neo-liberal"
agenda, imposing policies on
developing countries which have
been damaging, destructive and anti-
developmental. Some intellectuals in
developing countries have argued that
the World Bank is deeply implicated
in contemporary modes of donor and
NGO driven imperialism and that its
intellectual output functions to blame
the poor for their condition.
 Criticism…(cont’d)
 It has also been suggested that the World Bank is an instrument
for the promotion of U.S. or Western interests in certain regions
of the world. Consequently, seven South American nations have
established the Bank of the South in order to minimize U.S.
influence in the region. Criticisms of the structure of the World
Bank refer to the fact that the President of the Bank is always a
citizen of the United States, nominated by the President of the
United States (though subject to the approval of the other member
countries). There have been accusations that the decision-making
structure is undemocratic, as the U.S. effectively has a veto on
some constitutional decisions with just over 16% of the shares in
the bank; moreover, decisions can only be passed with votes from
countries whose shares total more than 85% of the bank's shares.
A further criticism concerns internal governance and the manner
in which the World Bank is alleged to lack transparency to
external publics.
 World Bank Support to India
 The World Bank works in close partnership with India’s
Central and State Governments, aligning its strategies with the
country’s own development agenda. It lays emphasis on
investing in people through better health and education,
empowering communities to participate in their own
development, improving the effectiveness of government, and
promoting private sector-led growth to achieve the country’s
development goals. 

 Its four-year Country Strategy for 2005-2008 focuses on

lending for infrastructure, human development, and improving
rural livelihoods. The Bank is increasingly focusing on
providing analytical reports on the country’s major
development challenges, and extending practical advice to
policy makers by sharing good practices and experience from
within the country and abroad.
 Lending

India is one of the oldest members of the

World Bank having joined the institution in
1944.
New World Bank lending to the country in FY08
(July 2007-June 2008) was US$2.7 billion. 
At end of June 2008, the Bank group had 60
active projects with a net commitment of about
US$ 13.8 billion for these projects
 IBRD/IDA Country Lending Summary

Number of Loans/Credits/Grants
IDA Credits CPL CPLCONV FSCL NPL REG SCPUSD VSL Total
Disbursing 44 0 0 0 1 0 0 0 1 0 28 0 74
Repaying 270 2 2 0 0 2 0 3 0 0 44 0 323
Fully Repaid 0 92 0 2 0 0 58 0 0 2 3 0 157
Other 29 18 0 0 0 4 2 0 0 0 3 2 58

Loans/Credits/Grants Summary In USD Equivalent

IBRD IDA Credits IDA Grants Total
Original Principal 37,311,563,798.56 35,949,820,000.00 0 73,261,383,798.56
Cancellations 7,488,040,947.38 2,505,500,252.12 0 9,993,541,199.50
Disbursed 24,489,783,521.18 29,791,315,727.73 0 54,281,099,248.91
Undisbursed 4,728,689,411.80 4,918,941,649.03 0 9,647,631,060.83
Repaid 17,078,855,417.43 7,415,691,430.95 0 24,494,546,848.38
Due 7,280,343,030.77 25,493,395,694.81 0 32,773,738,725.58
Exchange Adjustment 28,667,420.48 0 0 28,667,420.48

Borrower Obligation 7,309,010,451.25 25,493,395,694.81 0 32,802,406,146.06

 Country Strategy Progress Report 
 The India Country Strategy (CAS) for FY05-08 was
prepared at an important juncture: a coalition of political
parties led by Indian National Congress-which fought the
election on the plank of "reforms with a human face"-was
voted to power in May 2004, and the Indian economy
emerged out of a slump to register an unprecedented growth
rate of 8.4 percent in 2003/04.

 Given the fortuitous timing, the CAS anticipated the

impending shift in the policy stance toward a more inclusive
development agenda and the approaching economic boom-
thereby internalizing them in its design and contents. As a
result, nearly two and a half years since its Board approval,
the core strategy of the 2004 CAS remains largely
unchanged.
 This report reviews the progress made in
implementing the CAS, and discusses how the
strategy will be deployed for the remaining
period. It begins with an overview of the
country context, assessing political, economic,
and social developments since the CAS
discussions, then describes the experience to
date, and finally suggests the way forward for
the Bank Group, and presents the risks.
 Bibliography

 www.google.com
 www.wikipedia.org
 www.worldbank.org
 Time Magazine
 Outlook
 www.samachar.com