bdnews24.com :
Bangladesh had shown interest in joining the New Development Bank, or BRICS Bank, when it was coming into being in 2014 only for it to lean towards the China-sponsored Asian Infrastructure Investment Bank for funds.
Abul Maal Abdul Muhith, then the finance minister, had told bdnews24.com that the government had not been thinking much about BRICS Bank due to its sluggishness at the time and would consider joining it once it picked up speed.
Six years on, Bangladesh has agreed to be a part of the BRICS Bank initiative at a time when the bank has amassed $100 billion with an initial capital of $50 billion.
Analysts see it as a positive move. They believe the multinational bank would facilitate infrastructure loans minus the authoritative glare of the United States or European nations.
But they do not see a big difference between the NDB and other multinational development banks in terms of conditions for loans and banking operations.
BRICS is a joint initiative undertaken by Brazil, Russia, India, China and South Africa. The Agreement on the New Development Bank or NDB entered into force in July 2015.
On Dec 17 this year, India’s Prime Minister Narendra Modi invited his Bangladeshi counterpart Sheikh Hasina to join the bank.
Later that day, Foreign Minister AK Abdul Momen and Vikram Doraiswami, the Indian high commissioner in Dhaka, announced that Hasina had responded positively to the invitation.
As part of its expansion efforts, NDB has finalised its membership policy and begun the process to draft in new members.
After adopting a policy where any members of the United Nations can apply for the NDB membership, initially, each member state would be required to nominate two countries into the bank, The Economic Times reported.
Expansion of membership in the bank was also raised in the virtual BRICS Summit held on Nov 17.
“We support the NDB membership expansion process based on relevant decisions by the NDB Board of Governors. This will strengthen the NDB’s role as a global development finance institution and further contribute to the mobilisation of resources for infrastructure and sustainable development projects in Bank’s member states,” the declaration of the summit read.
“The process of expansion should be gradual and balanced in terms of geographic representation in its membership as well as supportive of the NDB’s goals of attaining the highest possible credit rating and institutional development.
“We welcome the launch of the formal negotiations with potential candidates based on these principles and work towards the timely expansion of NDB’s membership,” it added. In the 2017 summit of the bloc, the NDB Board of Governors created a list of countries to propose membership of the bank.
According to the terms and references of membership, new members would be required to appoint a governor and an alternate governor. Additionally, directors would be required to select their delegates, but the total number of directors would not exceed 10. During the summit in November, NDB President Marcos Troyjo highlighted the bank’s operations over the past five years.
“In mere five years, we have accomplished what peer institutions took decades to achieve,” said Troyjo. “We are talking about 65 projects totalling USD 21 billion. By the end of this year, we expect approvals to reach USD 26 billion,” he said. The NDB has earned AA-plus ratings from American credit rating agencies Fitch and Standard & Poor’s. It has obtained AAA ratings from Japan Credit Rating Agency and Analytical Credit Rating Agency.
These ratings put the NDB at a favourable position in raising funds at a competitive rate, said Zahid Hussain, former lead economist of the World Bank’s Dhaka office.
Mustafizur Rahman, a distinguished fellow at the Centre for Policy Dialogue, sees three key benefits for Bangladesh of joining the BRICS Bank.
“It shows our economic viability – that’s number one. Secondly, we can be involved in its policymaking process. And thirdly, we will have an upper hand getting loans if we are involved with it. I think it is a positive development,” he told bdnews24.com.
The World Bank, the Asian Development Bank, Japan International Cooperation Agency and others are supporting the government with funds to achieve the Sustainable Development Goals, for which the country needs $1 trillion in 15 years, or 20 percent of the GDP annually.
Bangladesh had shown interest in joining the New Development Bank, or BRICS Bank, when it was coming into being in 2014 only for it to lean towards the China-sponsored Asian Infrastructure Investment Bank for funds.
Abul Maal Abdul Muhith, then the finance minister, had told bdnews24.com that the government had not been thinking much about BRICS Bank due to its sluggishness at the time and would consider joining it once it picked up speed.
Six years on, Bangladesh has agreed to be a part of the BRICS Bank initiative at a time when the bank has amassed $100 billion with an initial capital of $50 billion.
Analysts see it as a positive move. They believe the multinational bank would facilitate infrastructure loans minus the authoritative glare of the United States or European nations.
But they do not see a big difference between the NDB and other multinational development banks in terms of conditions for loans and banking operations.
BRICS is a joint initiative undertaken by Brazil, Russia, India, China and South Africa. The Agreement on the New Development Bank or NDB entered into force in July 2015.
On Dec 17 this year, India’s Prime Minister Narendra Modi invited his Bangladeshi counterpart Sheikh Hasina to join the bank.
Later that day, Foreign Minister AK Abdul Momen and Vikram Doraiswami, the Indian high commissioner in Dhaka, announced that Hasina had responded positively to the invitation.
As part of its expansion efforts, NDB has finalised its membership policy and begun the process to draft in new members.
After adopting a policy where any members of the United Nations can apply for the NDB membership, initially, each member state would be required to nominate two countries into the bank, The Economic Times reported.
Expansion of membership in the bank was also raised in the virtual BRICS Summit held on Nov 17.
“We support the NDB membership expansion process based on relevant decisions by the NDB Board of Governors. This will strengthen the NDB’s role as a global development finance institution and further contribute to the mobilisation of resources for infrastructure and sustainable development projects in Bank’s member states,” the declaration of the summit read.
“The process of expansion should be gradual and balanced in terms of geographic representation in its membership as well as supportive of the NDB’s goals of attaining the highest possible credit rating and institutional development.
“We welcome the launch of the formal negotiations with potential candidates based on these principles and work towards the timely expansion of NDB’s membership,” it added. In the 2017 summit of the bloc, the NDB Board of Governors created a list of countries to propose membership of the bank.
According to the terms and references of membership, new members would be required to appoint a governor and an alternate governor. Additionally, directors would be required to select their delegates, but the total number of directors would not exceed 10. During the summit in November, NDB President Marcos Troyjo highlighted the bank’s operations over the past five years.
“In mere five years, we have accomplished what peer institutions took decades to achieve,” said Troyjo. “We are talking about 65 projects totalling USD 21 billion. By the end of this year, we expect approvals to reach USD 26 billion,” he said. The NDB has earned AA-plus ratings from American credit rating agencies Fitch and Standard & Poor’s. It has obtained AAA ratings from Japan Credit Rating Agency and Analytical Credit Rating Agency.
These ratings put the NDB at a favourable position in raising funds at a competitive rate, said Zahid Hussain, former lead economist of the World Bank’s Dhaka office.
Mustafizur Rahman, a distinguished fellow at the Centre for Policy Dialogue, sees three key benefits for Bangladesh of joining the BRICS Bank.
“It shows our economic viability – that’s number one. Secondly, we can be involved in its policymaking process. And thirdly, we will have an upper hand getting loans if we are involved with it. I think it is a positive development,” he told bdnews24.com.
The World Bank, the Asian Development Bank, Japan International Cooperation Agency and others are supporting the government with funds to achieve the Sustainable Development Goals, for which the country needs $1 trillion in 15 years, or 20 percent of the GDP annually.
