NEW DELHI: Ahead of the meeting of G20 finance ministers and central bankers, under India’s presidency, in Marrakech next week, the Development Committee of the World Bank has proposed the creation of additional annual lending capacity of more than $100 billion over the next decade for the multilateral lender to run a more inclusive agenda on climate change and poverty alleviation.
The final recommendations of the joint ministerial committee of the boards of governors of World Bank and the International Monetary Fund reflect suggestions made by the Independent Expert Group set up by the G20 co-chaired by 15th Finance Commission chairman N.K. Singh and former US treasury secretary Larry Summers.
The group has already submitted its second volume to finance minister Nirmala Sitharaman and will make a detailed presentation to the G20 at Marrakech, a person privy to the development told ET.
The group has suggested a roadmap and a detailed plan to reform multilateral development banks (MDBs), including the World Bank and Asian Development Bank.
The details include proposals that would enable MDBs to harness private capital apart from stepping up their financial capacity.
“We are going into greater granularity on how you really achieve this private capital—what incentive, risk mitigation can you do,” Singh said in an interview 10 days back.
The IEG had cited the need for $3 trillion to meet sustainable development goals by 2030, which it said, “includes a tripling of financing from all multilateral development banks (MDBs).”
“The proposed measures, along with the ‘preferencing’ approach, also respond to the innovative fundraising mechanisms (“Global Challenges Funding Mechanisms”) proposed in the report of an Independent Expert Group, commissioned by the G20,” the Development Committee paper stated.
The New Delhi Declaration adopted by G20 leaders in September had agreed to reforming MDBs to make them bigger and better and more cognisant of the needs of the Global South.
