Nirmala Sitharaman urges for affordable, cheaper World Bank lending for middle income countries

New Delhi [India], October 26 (ANI): Union Finance Minister Nirmala Sitharaman has called for more affordable and cheaper lending from World Bank during her the annual meeting with the organization.

The minister was speaking at the Development Committee Plenary session on “A Future-Ready World Bank Group” at the World Bank’s 2024 Annual Meetings in Washington, D.C., on Friday.

“The Union Finance Minister sought a more affordable @WorldBankwith a more competitive pricing model to foster broader participation, incentivise middle-income countries to borrow more and deepen development impact” said the Ministry of Finance in a social media post.

The minister also emphasized the need for the World Bank to adopt a data-driven, evidence-based approach in preparing global indices and country comparisons.

She reaffirmed India’s position that indices like the Worldwide Governance Indicators and the newly proposed B-Ready index should be grounded in objective data.

The Finance Ministry added “FM Smt.@nsitharaman reiterated India’s stand that @WorldBankshould adopt a strictly evidence-based and data-driven approach when preparing global indices and country comparators such as the Worldwide Governance Indicators and the new B-Ready index”.

Sitharaman also called for the World Bank to make its lending model more affordable, with competitive pricing to encourage wider participation from middle-income countries. She highlighted that such an approach could incentivize these countries to engage more with the World Bank, ultimately enhancing the development impact of the Bank’s programs.

Reflecting on the history of multilateral development banks, Sitharaman noted the crucial role of the Global South in shaping the foundations of these institutions at the 1944 Bretton Woods conference.

She stressed the importance of embedding diverse perspectives in the World Bank’s decision-making processes to establish an inclusive, global development framework.

As part of her recommendations, Sitharaman encouraged the World Bank to foster a two-way exchange of innovations by drawing from the transformative experiences of the Global South in areas like digital inclusion and sustainable energy. These contributions, she suggested, can provide valuable insights and solutions for other nations facing similar challenges.

The Finance Minister commended the World Bank’s recent efforts to optimize its balance sheet, enabling it to increase its financial capacity.

However, she noted that with emerging economies facing growing global economic challenges and increased developmental needs, there is an urgent need for both new and concessional funding. Such resources, she argued, would help address the economic and social challenges that many developing nations currently face.

Sitharaman also expressed hope for a “future-ready” World Bank that is capable of addressing key global priorities, empowering different regions, and fostering partnerships. She called on the World Bank to take proactive steps toward meeting the Sustainable Development Goals (SDGs) for 2030 and beyond, aligning its policies to help accelerate global progress.