New President of World Bank

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Context:

Indian origin Ajay Banga was confirmed as the next President of World Bank.

Relevance:

GS III: Indian Economy

Dimensions of the Article:

The President of the World Bank (WB) is responsible for overseeing the entire WB Group and managing the Bank’s operations.
Traditionally, the President of the Bank has always been a U.S. citizen, nominated by the United States, the largest shareholder in the bank.
The nominee must be confirmed by the board of executive directors and serves a five-year, renewable term.
The boards of directors consist of the WB Group President and 25 executive directors. The President chairs the meetings and has the power to break a tie, but ordinarily has no vote.
Executive directors cannot exercise any power, commit or represent the Bank unless specifically authorized by the boards.

The World Bank (WB) is an international organization which provides facilities related to “finance, advice and research to developing nations” in order to bolster their economic development.
It provides loans and grants to the governments of poorer countries for the purpose of pursuing capital projects.
It comprises two institutions: The International Bank for Reconstruction and Development (IBRD), and the International Development Association (IDA).
The World Bank is a component of the World Bank Group.

The World Bank Group is an extended family of five international organizations, and the parent organization of the World Bank, the collective name given to the first two listed organizations, the IBRD and the IDA:
1. International Bank for Reconstruction and Development (IBRD)
2. International Development Association (IDA)
3. International Finance Corporation (IFC)
4. Multilateral Investment Guarantee Agency (MIGA)
5. International Centre for Settlement of Investment Disputes (ICSID)
With 189 member countries, the World Bank Group is a unique global partnership: five institutions working for sustainable solutions that reduce poverty and build shared prosperity in developing countries.
The Bank Group works with country governments, the private sector, civil society organizations, regional development banks, think tanks, and other international institutions on issues ranging from climate change, conflict, and food security to education, agriculture, finance, and trade.

The International Bank for Reconstruction and Development: The International Bank for Reconstruction and Development (IBRD) lends to governments of middle-income and creditworthy low-income countries.
The International Development Association: The International Development Association (IDA) provides interest-free loans — called credits — and grants to governments of the poorest countries. It is called the soft loan window of the World Bank. Together, IBRD and IDA make up the World Bank.
The International Finance Corporation: The International Finance Corporation (IFC) is the largest global development institution focused exclusively on the private sector. It helps developing countries achieve sustainable growth by financing investment, mobilizing capital in international financial markets, and providing advisory services to businesses and governments.
The Multilateral Investment Guarantee Agency: The Multilateral Investment Guarantee Agency (MIGA) was created in 1988 to promote foreign direct investment into developing countries to support economic growth, reduce poverty, and improve people’s lives. MIGA fulfils this mandate by offering political risk insurance (guarantees) to investors and lenders.
The International Centre for Settlement of Investment Disputes: The International Centre for Settlement of Investment Disputes (ICSID) provides international facilities for conciliation and arbitration of investment disputes.

-Source: The Hindu