World Bank endorses $25-30 billion plan for India

The World Bank Group (WBG) has approved a $25-30 billion commitment plan for India for the 2019-22 period. The new Country Partnership Framework (CPF), endorsed by the WBG board of executive directors focuses on the development priorities of the country - resource efficient and inclusive growth, job creation and building its human capital.

The WBG institution comprises of the International Bank for Reconstruction and Development (IBRD), International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA).

"This CPF charts a path for how the World Bank, IFC and MIGA, will leverage their relative strengths to deliver stronger development outcomes for this dynamic country, half of whose population is under the age of 25," Hartwig Schafer, World Bank South Asia Vice President says.

The CPF is underpinned by the Systematic Country Diagnostics (SCD), the World Bank Group's comprehensive analysis of the opportunities and challenges for India to achieve poverty reduction and shared prosperity in a socially and environmentally sustainable way, and builds on extensive consultations with the government, the private sector, civil society and academic experts from across the country.

A WBG press release said that special emphasis will be given to projects that promote a resource efficient growth path, particularly in the use of land and water, to remain sustainable; enhancing competitiveness and enabling job creation; and investing in human capital - in health, education, skills - to improve quality and efficiency of service delivery. "Within these, some areas of deeper WBG's engagement will include addressing the challenge of air pollution, facilitating jobs for women, increasing the resilience of the financial sector and investing in early years of children's development. Across the sectors, the WBG will invest in harnessing the impact of new technology," the statement said.

The CPF highlights the shift from a "lending" to a "leveraging bank", emphasizing the growing potential and need to draw in capital markets in the financing of development priorities, it added.

Complementing transformational national programs, CPF notes that the bank will also develop strategic state partnerships to address state-specific development priorities and support implementation capabilities at the state and local level.

"An important focus of the CPF will be to deepen engagement with India's states and invest in the institutions and capabilities of the states and local governments to address their development priorities,"  Junaid Ahmad, Country Director, World Bank India said.

The CPF also places emphasis on India's global leadership role in promoting renewable energy and disaster resilient infrastructure development, which holds significant impact for India as well as the global economy. Through an initiative labelled "Lighthouse India" the WBG will leverage India's development experience to support the development efforts of other countries especially in Africa and Central Asia.

The emphasis on a "leveraging Bank" is reflected in the CPF in the potential role of private sector finance and expertise to meet India's development needs at scale.

India is the largest IBRD client of the World Bank. Between 2015 and 2018, the World Bank lent around $10.2 billion to India. As of mid-September 2018, total World Bank assistance stood at $27.2 billion representing 104 projects, of which IBRD was $18.1 billion (52 projects) and IDA $9.0 billion (46 projects). At the end of July 2018, IFC's India portfolio contained 281 projects, amounting to a committed exposure of $6.4 billion.