Neha Bhartiya (130)Prateek Meharia (138)Punit Rajmohan (140)

World bank

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WORLD BANK

International financial institution that provides loans to developing countries for capital programmes

Official goal: Reduction of poverty Bretton Woods Conference, 1944 Headquarters: Washington DC Membership: 187 countries President: Robert B. Zoellick Parent Organization: World Bank Group

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WORLD BANK GROUP

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WORLD BANK MISSION

To fight poverty with passion and professionalism for lasting results. To help people help themselves and their environment by providing resources, sharing knowledge, building capacity, and forging partnerships in the public and private sectors.

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IBRD

Created December 27, 1945 187 members Original institution of the World Bank Largest country membership, the broadest mission,

and the greatest number of staff in the Bank Group First task to help Europe recover from World War II

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IBRD

Plays an important role in poverty reduction; provides middle-level and poor credit-worthy countries with loans, guarantees, analytical and advisory services

Supports long term human and social developmental needs that private creditors do not finance

Preserves borrowers’ financial strength by providing support during crisis periods, which is when poor people are most adversely affected

Creates favorable investment climate to catalyze provision of private capital

Provides financial support in the form of grants made available from IBRD’s net income in areas which are critical to the well being of poor people in all countries7/01/2011

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IDA

Created September 24, 1960 Provides loans to 81 countries 171 member countries IDA helps world’s poorest countries reduce poverty

by providing credits and grants IDA’s goal is to reduce disparities across and within

countries— especially in terms of access to primary education, basic health, and water supply and sanitation—and to bring more people into the economic mainstream by raising their productivity.

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IFC

Promotes sustainable private sector investment in developing countries

Established 1956 182 member countries Member of the World Bank Group Promotes sustainable private sector development by:

Financing private sector projects and companies located in the developing world.

Helping private companies in the developing world mobilize financing in international financial markets.

Providing advice and technical assistance to businesses and governments.

MIGA

Founded 1988 Promotes foreign direct

investment into developing countries by insuring investors against political risk, advising governments on attracting investment, sharing information through on-line investment information services, and mediating disputes between investors and governments

Member of the World Bank Group 174 member countries

International Centre for Settlement of Investment Disputes

Established 1966 143 member countries Member of the World Bank Group Provides facilities for the conciliation

and arbitration of investment disputes between member countries and individual investors.

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Difference between World Bank and IMF

The World Bank lends only to developing or transition economies, whereas all member countries, rich or poor, can draw on the IMF’s services and resources.

The IMF’s loans address short-term economic problems: they provide general support for a country’s balance of payments and international reserves while the country takes policy action to address its difficulties. The World Bank is concerned mainly with longer-term issues: it seeks to integrate countries into the wider world economy and to promote economic growth that reduces poverty.

The IMF focuses on the macroeconomic performance of economies, as well as on macroeconomic and financial sector policy. The World Bank’s focus extends further into the particular sectors of a country’s economy and its work includes specific development projects as well as broader policy issues.

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Millennium Development Goals

MDGs were endorsed by 189 countries at the September 2000 UN Millennium General Assembly in New York.

MDG’S came out of the agreements and resolutions that have resulted from world conferences organized by the UN in the past 10–15 years. Each goal is to be achieved by 2015.

Their aim is to reduce poverty while improving health, education, and the environment.

To achieve the MDGs poorest countries require financial aid.

Developing countries may also benefit if trade barriers are lowered, thereby allowing a freer exchange of goods and services. 7/01/2011

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Goals and Targets of Millennium Declaration

DEVELOP A GLOBAL PARTNERSHIP FOR DEVELOPMENT

ENSURE ENVIRONMENTAL SUSTAINABILITY

COMBAT HIV/AIDS, MALARIA, AND OTHER DISEASES

IMPROVE MATERNAL HEALTH

REDUCE CHILD MORTALITY

PROMOTE GENDER EQUALITY AND EMPOWER WOMEN

ACHIEVE UNIVERSAL PRIMARY EDUCATION

ERADICATE EXTREME POVERTY AND HUNGER

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The World Bank’s Finances

IBRD IBRD – taps the world’s capital markets IBRD raises money primarily by selling bonds in international financial markets.

It sells AAA-rated bonds and other debt securities to pension funds, insurance companies, corporations, other banks, and individuals around the world

IBRD uses capital from reserves built up over the years and money paid in from the bank's 187 member country shareholders

IBRD charges interest to its borrowers at rates that reflect its cost of borrowing. Loans must be repaid in 15 to 20 years, and there is a 3- to 5-year grace period before repayment of principal begins

IDA IDA, the world’s largest source of interest-free loans and grant assistance to the

poorest countries, is replenished every three years by donor countries Provides 35- to 40-year no-interest loans. IDA accounts for nearly 40 percent of

World Bank lending Forty countries contribute to IDA’s funding. Chief donors are France, Germany,

Japan, United Kingdom, and the United States

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World Bank - Profits

Income used to sustain operating expenses Some of the surplus goes to IDA The rest of the surplus is either used for debt

relief for heavily indebted poor countries To meet unseen humanitarian crises IBRD seeks not to maximize profit but to earn

enough income to ensure its financial strength and to sustain its development activities

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Project Cycle

The Project Cycle is the framework used by the World Bank to design, prepare, implement and supervise projects

The World Bank's public-lending institutions (IDA and IBRD) lend about US$ 15-20 billion annually to 100 countries to Projects ranging from infrastructure, education, health and government financial management

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Project Cycle

Pre-PipelineStudies of development issues carried at the thematic, country and sector level.  This is used to improve the Bank’s understanding of development challenges and to promote best practice among staff

IdentificationThe World Bank and borrowing countries jointly identify projects that support their development goals. The identification stage can take up to a year and a half 

PreparationThe borrowing country is responsible for project preparation. During this stage, which can last up to two years, the borrowing country continues to conduct further studies and impact assessments that includes economic, financial, social and environmental impacts

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Project Cycle Appraisal

Appraisal is the sole responsibility of Bank staff.  Project Appraisal Document (PAD) is prepared which provides a detail description of the project and its implementation.  The Appraisal stage often lasts between 3-6 months

Negotiation and Approval

During negotiations, the World Bank and borrowing country will agree on the terms of the loan supporting the project.  Typically, negotiations last about 1-2 months

Implementation and Supervision

After the loan or credit is approved, the borrowing country can use the funds to purchase the goods and services necessary to meet the project’s objectives.  The borrowing country, is responsible for implementing the project.  The World Bank’s role is to monitor project implementation to ensure that the terms of the loan/credit agreement are followed and that procurement is conducted according to the World Bank’s guidelines

Evaluation

Following completion of the project, the Bank’s Independent Evaluation Group, conducts an audit of the project, where the project's outcome is measured against its original objectives

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Ways of classifying countries

Low income, Middle and High income

Developing and industrial economies:

Donors and borrowers Part I, part II: Countries choose whether they are Part I or

Part II primarily on the basis of their economic standing

Income level of countries

average annual per capita

low $875 or less

lower-middle $876 to $3,465

upper-middle $3,466 to $10,725

High $10,726 or more

developing low-income or middle-income

industrial high-income

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Sectors of operation

Agriculture and rural development

Aid effectiveness Combating corruption Conflict prevention and fragile states Debt relief Economic research and data Education Empowerment and

participation Energy and mining Environment Financial sector Gender Globalization Governance

Health, nutrition, andnpopulation Indigenous peoples Information and communication technologies Infrastructure Labour and social protection Law, regulation, and the judiciary Manufacturing and services Poverty Private sector development Social development Sustainable development Trade Transport Urban development Water

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Initiatives

Multilateral Debt Relief Initiative (MDRI)• To cut the debt burdens of many of the world’s poorest

countries to acceptable levels. Total debt relief under the MDRI is estimated at about $50 billion(2008)

Low-Income Countries Under Stress (LICUS) Initiative• Which recommends ways to help countries with particularly

weak policies and institutions get onto a path of sustained growth and poverty reduction by improving the effectiveness of development aidEducation for all fast track initiatives

• The initiative’s goal is to accelerate progress toward achievement of the MDGs for education. It is open to all low-income countries that demonstrate a serious commitment to achieving universal primary education

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World Bank

IDA Lending

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Infrastructure• Mumbai Urban Transport Project (MUTP)• Rural roads• Building state highways in A.P.

Rural development• Empowering the poor in Tamil Nadu• Reclaiming saline lands in UP• Improving agriculture in Assam • Reversing the degradation of natural resources in lower

Himalayas• Rural water supply and sanitationCreating jobs

Health• Eliminating leprosy• Controlling T.B .• Reconstruction

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WORLD BANK IN INDIA

Active Projects

• North east rural livelihood project(NERLP)(20-dec-2011)• Uttar Pradesh Health Systems Strengthening Projects (UPHSSP)

(20-dec-2011)• Rampur Hydropower project- carbon finance (6th oct 2011)• Capacity Building for Urban Local Bodies-NURM (21st July 2011)• West Bengal Accelerated development of Minor Irrigation (24th

Oct 2011)• Karnataka State Highway Improvement (24th March 2011)• National Ganga River Basin Project(31-may-2011)• Rajasthan Rural Livelihood Project – RRLP (11th Jan 2011)

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Current Lending by Sector in Number of Projects - India

http://web.worldbank.org7/01/2011

Year 2011

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Lending in Millions of US Dollars to India

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IDA – INDIA FUNDING

Sarva Shiksha Abhiyan or SSA In 2002 India unveiled its national flagship program, the Elementary

Education Project (Sarva Shiksha Abhiyan or SSA), financed by the International Development Association (IDA).

IDA is the single largest donor. IDA’s SSA I project (2004 to 2007) contributed US$500 million of the program’s total cost of US$3.5 billion. In May 2008, SSA II was approved with an IDA commitment to provide an additional US$600 million to the program, In March 2010, following the Government of India’s decision to extend SSA II for another two years, additional IDA funding of US$750 million was approved for 2010-12

With SSA having made great strides in increasing access to primary education, the focus is now on bringing the remaining 8.1 million out-of-school children into school, boosting provision of upper-primary educational facilities, and improving learning outcomes

IDA – INDIA FUNDING

Bhoomi Project – IDA funded project Deals with  computerization of 20 million

records of land ownership It will benefit nearly seven million rural

farmers by allowing them to transfer land titles online.

The project has reduced corruption and saved time and costs.

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Impact of World Bank

During the past 40 years, life expectancy in developing countries has risen by 20 years—about as much as was achieved in all of human history prior to the mid-20th century.

During the past 30 years, adult illiteracy in the developing world has been nearly halved to 25 percent.

During the past 20 years, the absolute number of people living on less than US$1 a day has begun to fall for the first time, even as the world's population has grown by 1.6 billion people.

During the last decade, growth in the developing world has outpaced that in developed countries, helping to provide jobs and boost revenues poor countries' governments need to provide essential services.

MNEs MNEs prefer World bank funded projects rather than country

funded projects

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FEEDBACK

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