India to join multilateral lender EBRD |ForumIAS

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Context:

Introduction:

European Bank of Reconstruction and Development shareholders approve its entry as 69th member.
EBRD’s board of governors, which represents all the existing shareholders of the UK-based bank, voted in favour of India’s membership application last week

Significance of this decision:

This is an important step in the relationship between the EBRD and India.
It will allow the EBRD to build on already close ties with India.
The move will enable Indian companies to undertake joint investments in regions in which the EBRD operates.
The move will see India take up a small stake in the bank, would spur further investment by Indian firms in a range of sectors from solar to utilities, providing them access to fast growing markets.
It will also enable Indian citizens to work for the organisation.

European Bank of Reconstruction and Development

The London-headquartered EBRD is a multilateral development bank set up in 1991 after the fall of the Berlin wall to promote private and entrepreneurial initiative in emerging Europe.
It invests in 38 emerging economies across three continents, according to a set of criteria that aim to make its countries more competitive, better governed, greener, more inclusive, more resilient and more integrated.
It remains committed to furthering the development of “market-oriented economies and the promotion of private and entrepreneurial initiative.”
Other members who receive investments include Mongolia, Turkey, Egypt, Cyprus, Greece and Lebanon, among a total of 38 member states.
Others including China, the U.S., U.K., and France are stakeholders, whose companies are able to invest in EBRD projects, but do not receive financing for domestic projects.
The EBRD’s largest shareholder is currently the U.S., while other G7 nations also hold significant stakes.
In 2017, the EBRD signed a pact with the International Solar Alliance, which was unveiled in 2015 in Paris.