The United Nations, the International Monetary Fund and the World Bank were established for different personal interests for all the countries of the world, in which America took the most initiative. These institutions have a different utility for developing countries and it has a different utility for a developing country like India.
Here we will try to know about the World Bank, which we only hear as the World Bank, but what is the World Bank Group and how it works, what is its purpose, we will try to know through this article. We will analyze any topic with facts, but what will be its economic, political and social consequences, which you will not get to see anywhere.
Examining any subject only academically, it does not understand that topic properly and when we start working, then the reality is quite different. That’s why we will try to do this topic by keeping the reality in front, and try to keep neutral facts and especially critical analysis.
What is the World Bank ? –
We know this popular name, but it is known as the World Bank Group, which is considered a constituent of the United Nations Organization. The basic objective of the World Bank is to remove the poverty of the world and through economic assistance to help poor and developing countries through policy and experts.
America had taken the maximum initiative for the World Bank and we have to understand what is the utility of the World Bank for the developed countries and what is the utility of the World Bank for the poor and developing countries. It is possible for the developed countries to implement their economic model on the rest of the world through the World Bank.
So that their international trade can increase. The same developing and poor countries benefit from this, they get financial help to develop within themselves and help in increasing their business and economic status of the people. With this, this organization works for all the countries of the world through its own interest.
Formation of World Bank –
The World Bank was established at the Bretton Wood Conference in 1944 along with the International Monetary Fund, whose work began directing in 1946. The time when the World Bank was established was the beginning of the Second World War and the first loan of the World Bank was given to Poland, which had suffered a lot of financial loss due to the World War.
The World Bank later fixed its objective to provide financial assistance to the developing countries and poor countries of the world, and its objective was made to stop the world’s poverty and hunger. Countries that are members of the International Monetary Fund become members of the World Bank, these two institutions run in coordination with each other and run under the United Nations.
After 1950, the World Bank provided a lot of loans to the infrastructure of developing countries, so that such countries could be helped to improve their economic structure. Loans have been provided for primary education and for improving the ground water level in a country like India. How this bank gives financial and technical assistance for all such development.
History of World Bank –
The economic structure before the Second World War was quite different from today’s economic structure and the poor and today’s developing countries were run under the control of most developed countries of Europe, which was called vassalism. Western countries used to do their economic trade through this Vashat to do international trade.
In this economic structure of vassalism, Britain used to do most of the business and as the economic superpower of the world, it maintained the domination of the world at that time. The world war weakened Britain a lot and America was very strong because most of the countries of Europe were in great economic crisis due to this war, but America has been the opposite.
With the economic system of the World Bank, America made itself the economic superpower of the world, in which a small number of countries were in the interest of America’s economic policy until 1990 at the initial level, but after the end of the Cold War of 1990, the importance of the World Bank increased significantly and China and India have taken maximum advantage of this.
Object of World Bank –
- The World Bank provides financial assistance to the developing countries for the development of the country through the organization of IBRD and IDA in World Bank Group.
- The main objective of the World Bank is to remove the poverty of the world, for which they want to promote international trade, through which economic trade can increase in such countries.
- After the Second World War, Britain, France and many countries of Europe were financially in crisis, which was aimed at rebuilding.
- To improve their economy by giving financial assistance to India, Pakistan and other developing countries.
To encourage private investors to invest in poor and developing countries, for which arbitration through guarantees.
- To promote international trade so that the poor and developing member countries can benefit from the economy of developed countries.
- The world has seen two wars, which has also suffered the loss, so be ready for whatever plans you have to make to do business peacefully in the world.
- To make plans for the protection of nature and protection of natural resources, so that providing financial assistance to poor and developing countries.
- To create a balance of economic trade in the world and to make plans for it to improve the safety and economic status of the employees.
- Providing financial assistance for it by making programs of education and health, such as financial assistance was provided to many countries in the corona epidemic.
Structure of World Bank –
The World Bank Group has been formed with five important organizations in which …
- International Bank for Reconstruction & Development (IBRD)
- International Development Association (IDA)
- International Finance Commission (IFC)
- Multilateral Investment Guarantee Agency (MIGA)
- International Center for Settlement of Investment Disputes (ICSID)
IBRD – This organization provides loans to developing countries and poor countries who are able to pay such loans at market rates. IBRD raises this capital from the market and makes it available to the member countries through loans.
IDA – This organization was established in 1960 and its basic objective is to provide loans without interest to poor and developing countries so that education, health and rural development can be worked on. The help given by the IDA to the member countries is made available in collaboration with the member developed countries.
IFC – This organization, in collaboration with private investors, provides loans and credit guarantees to promote business in developing countries.
MIGA– This organization provides credit guarantee and insurance to international investors in developing countries where there is a risk creation other than business.
ICSID – The creation of this institution, without relying on the legal system of a developing country, has built its judicial system, under which any international investor having legal problems in such countries are settled by arbitration and conciliation.
Functions of World Bank Works –
- The main task of the World Bank is to provide 20% loans to poor and developing countries in exchange for their paid-up share capital.
- Technical facilities are provided by the World Bank Group to the member countries.
- What will be the terms-condition, what will be the interest tax rate and how much loan is to be given, it is decided by the World Bank.
- When member countries apply for a particular project, the World Bank provides loans for it.
- The practice in which the World Bank provides loans is paid according to the reserve currency or the currency that has been fixed.
- The World Bank provides loans to private investors of member countries, but it often has to get consent from its own country.
- To provide loan under various schemes for protection of nature.
- To provide technical support and money through various schemes for education, health and poverty alleviation.
World Bank & IMF –
Both these organizations were established at the Bretton Wood Conference in America when the world war was going on and the United Nations Organization was established after the end of the world war. This period was the end of Britain’s vassalist power and the beginning of America’s capitalist economy, in which America took the initiative to create both these institutions.
The objective of the International Monetary Fund was kept separate, and the purpose of the World Bank was kept separate, which was called twin in this conference. World Bank This name was later popularized, at the time of its establishment it was named “International Bank for Reconstruction and Development” ie IBRD, which was later recognized as the World Bank Group through five major organizations.
The objective of the International Monetary Fund is to provide stability to the world’s economic and financial markets and to provide economic security to the countries which are in financial and financial crisis, through loans and economic policies.
Whose member countries can take advantage of it, whose main objective is to provide economic security to poor and developing countries, the same World Bank does this very wide work and provides economic and technical assistance for development to developing countries.
World Bank & India –
Politically, the dominance of the World Bank has been of America and their capitalist system, which they have used for their economic and political gains, it can be said that. China and India have benefited a lot from the World Bank for their development, but international intervention in economic policy has increased significantly.
China: The advantage of being a permanent member in this Security Council has always been arising, but India has always benefited from the economic war going on between America and China, since India has changed its economic policy in 1990. India has been the country that has taken the highest loan from the World Bank and has taken loans for a lot of development plans.
Under America’s strategy, China has been providing help through the World Bank to counter. Its only problem has been that the World Bank’s policy of private reasons makes the government feel more at risk of losing control of the economic system, which we should think about because it is said that “whatever gives also indicates.” Is”.
Critical Analysis of World Bank –
- The World Bank was established with the initiative of America, which has been influenced by the capitalist ideology, whose aim should be to leave the market control on the market, the consequences of which are seen in developing countries.
- The economic conditions that the World Bank imposes while giving loans, due to which the intervention of the World Bank in the country’s economy is visible.
- The purpose of the establishment of the World Bank is to remove the poverty of the world and to make it economically prosperous, but politically all the developed countries are seen protecting their interests.
- Through the World Bank, the policy of open economy was implemented on all the member countries, whose economic benefit has been the most for a country like America.
- The influence of the US and European countries is more visible in the decision-making process in the World Bank.
- There are many features of political diplomacy to be seen while planning the funds of the World Bank.
- In the economic policy of the World Bank, the state’s less interference in trade and open market can weaken the country’s trade.
In this way, we have tried to know about the World Bank here, where we have come to know what are the functions of the World Bank and what is called the World Bank of reality. Tried to know about the five major organizations that work under the World Bank and what are its objectives.
Here we have tried to know about how the World Bank works under the United Nations and with the International Monetary Fund. We know how we got the advantage of the World Bank to counter China under America’s strategy.
Instead of knowing the World Bank only from the point of view of education, we have tried to know it from political and economic point of view through analysis. So that we have tried to understand how India has to use the World Bank for its own benefit. We also have to understand how developed countries benefit from economic policies on Asian and African countries and how they benefit their exports.