Bretton woods conference
- United Nations Monetary and Financial Conference, commonly known as Bretton Woods conference, was held in Bretton Woods, New Hampshire, USA to regulate the international monetary and financial order after the conclusion of World War II (1939-45). Total 44 nations participated, including India.
- The conference proposed 3 institutions
- International Bank for Reconstruction and Development (IBRD), commonly known as World Bank.
- International Monetary Fund (IMF)
- International Trade Organisation (ITO) : could not materialize. Instead, the countries later set up GATT which eventually became WTO.
- While the World Bank and IMF are considered “Specialized Agencies of UN”, the WTO is considered “Related organization of UN” as it doesn’t fulfill all requirements of UN charter on specialized agencies.
World Bank
1. The World Bank is an international financial institution that provides loans and grants to the governments of low- and middle-income countries for the purpose of pursuing capital projects.
2. The World Bank is the collective name for the International Bank for Reconstruction and Development (IBRD) and International Development Association (IDA), two of five international organizations owned by the World Bank Group.
3. It was established along with the International Monetary Fund at the 1944 Bretton Woods Conference.
4. IBRD and IDA have 189 and 174 member countries, respectively.
5. India is one of the founding members of IBRD, IDA and IFC.
6. The U.S., Japan, China, Germany and the U.K. have the most voting power.
7. Since USA and European powers collectively command large shareholding in World Bank & IMF, so their informal arrangement is – USA’s favorite will be picked as World Bank chief, while European countries’ favorite will be picked as IMF Chief.
8. The bank aims loans at developing countries to help reduce poverty. The bank is engaged in several global partnerships and initiatives, and takes a role in working toward addressing climate change.
9. The World Bank operates a number of training wings and it works with the Clean Air Initiative and the UN Development Business. It works within the Open Data Initiative and hosts an Open Knowledge Repository.
| International Bank for Reconstruction and Development (IBRD) | Commonly known as the world bank. Gives development loans with low interest to low and middle income countries.Voting power – Depends on the share capital provided by a country. USA highest, followed by various European giants. |
| International Development Association (IDA) | Assists the poorest countries via interest- free long-term loans (“Concessional Loans” or “soft loans”).IBRD and IDA share the same staff and headquarters and evaluate projects with the same rigorous standards. |
| International Finance Corporation (IFC) | Support the growth of the private sector in the developing world.It is a public entity, although its clientele consists of transnational, national, and local private sector companies, operating in a competitive and fast-moving business environment. |
| Multilateral Investment Guarantee Agency (MIGA) | Its mission is to promote FDI into developing countries to help support economic growth, reduce poverty and improve people’s lives. |
| International Centre for the Settlement of Investment Disputes (ICSID) | Helps in dispute resolution related to foreign investment / foreign companies in third world countries. India is not a member of this organization. |
India and the World Bank Group
1. India is one of the founding members of IBRD, IDA and IFC. India became a member of MIGA in January 1994.
2. India is a member of four of the five constituents of the World Bank Group viz., International Bank for Reconstruction and Development (IBRD), International Development Association (IDA), International Finance Corporation (IFC) and Multilateral Investment Guarantee Agency (MIGA).
3. India is not a member of ICSID (International Centre for Settlement of Investment Disputes).
Reports Published by World Bank
- World Development Report,
- Ease of doing business Index,
- Remittance & Migration Report,
- Global Economic Prospects report
- International Debt Statistics
- World Development Indicators