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BRICS bank opens for business in China

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The New Development Bank (NDB) floated by the BRICS nations, including India, to step up infrastructure funding in the emerging economies formally started its operations at its headquarters on 21st July 2015.

  • K V Kamath, 67, will be the bank’s president for the first five years.
  • The NDB will supplement the existing international financial system in a healthy way and explore innovations in governance models.
  • BRICS economies — Brazil, Russia, India, China and South Africa, launched the multi-billion dollar development bank at the 7th BRICS summit held in the Russian city of Ufa on July 8th 2015.
  • Its efforts are to finance infrastructure projects, mainly in member countries.
  • The NDB will have initial capital of USD 50 billion, which will be expanded to USD 100 billion within the next couple of years.
  • Each BRICS member will contribute an equal share in establishing a startup capital.
  • The NDB was conceived as a counterbalance to Western-led financial institutions like the World Bank and the IMF by providing funding for infrastructure and development projects in BRICS countries.
  • Each nation will have an equal say in the bank’s management, regardless of GDP size.
  • The NDB is also backed by the China-floated USD 50 billion Asia Infrastructure Investment Bank (AIIB) in which India and 56 other countries have joined.
  • The World Bank welcomed the opening of NDB.

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