European Bank of Reconstruction and Development (EBRD), the London-based Multilateral Developmental Investment Bank’s Shareholders agreed, as per release dated March 7, 2018, to have India as its 69th member; enabling Indian companies to undertake joint investments in regions in which the EBRD operates. India is expected to join EBRD within the year 2018. India with its impressive economic growth over the years and enhanced international political profile, considered it appropriate to expand its presence on the Global Developmental Landscape beyond its association with the Multi-lateral Development Banks (MDBs) such as the World Bank, Asian Development Bank and African Development Bank. India had earlier taken the decision to join the Asian Infrastructure Investment Bank (AIIB) and the New Development Bank (NDB); and in the same backdrop India’s Union Cabinet chaired by its Prime Minister Narendra Modi approved on November 22, 2017 India’s Membership for EBRD and applied for it in December, 2017. The formal membership process will now get underway, which includes the purchase of the minimum of 100 shares by India at an estimated cost of around €1 million. The EBRD’s largest shareholder is currently the U.S., while other G7 nations also hold significant stakes.
EBRD was established in 1991, after fall of the Berlin wall, based on a proposal by former French President Francois Mitterand, to promote private and entrepreneurial initiative in emerging Europe. It is headquartered in London, United Kingdom. EBRD’s initial focus was helping Central and Eastern European nations reconstruct their economies in the post-Cold War era. EBRD uses investment as a tool to build market economies.
EBRD has invested over €115 billion in more than 5000 projects since its inception in 1991. Its investments foster growth and innovation; and promote countries’ transition to market economies. It is committed to promotion of private and entrepreneurial initiative. It offers a wide range of financial instruments and other services and takes a flexible approach in structuring its products and provides project financing for banks, industries and businesses, both new ventures and investments in existing companies. It also offers business advisory services. Economic inclusion is integral to achieving a transition towards sustainable market economies. Its team of economists provide leading-edge analysis and insight on the latest economic and social developments in the EBRD region and beyond.
Indian businesses have already cooperated on EBRD projects worth some €982 million, the hope is that the membership, which 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. India’s stake will also give it a say in the direction of the EBRD’s future work.
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