Indian-origin Ajay Banga elected as new World Bank president for 5-year term

The World Bank's 25-member executive board on Wednesday elected former Mastercard CEO Ajay Banga to a five-year term as president, effective June 2, ushering in the India-born finance and development expert to revamp the lender to tackle climate change and other global crises.

Banga, 63, was nominated for the post by US President Joe Biden in late February and was the sole contender to replace departing World Bank chief David Malpass, an economist and former US Treasury official during the Trump administration.

Banga has met with officials from 96 governments since his nomination, the source said. He visited eight countries during a three-week world tour to meet with government officials, business leaders and civil society groups, flying a total of 39,546 miles.

The World Bank has been led by an American since its founding at the end of World War Two, while the International Monetary Fund has been led by a European. Banga, who was born in India and spent his early career there, has been a US citizen since 2007.

Biden congratulated Banga on his "resounding approval" to run the World Bank, which he described as "one of humanity’s most critical institutions to reduce poverty and expand prosperity around the globe."

"Ajay Banga will be a transformative leader, bringing expertise, experience, and innovation to the position of World Bank President," Biden said. "He will help steer the institution as it evolves and expands to address global challenges that directly affect its core mission of poverty reduction — including climate change."

Treasury Secretary Janet Yellen said Banga brought the "right leadership and management skills" to the job, and would play a critical role in pushing forward with additional reforms, including by forging partnerships between the public and private sectors and nonprofit groups.

"Ajay understands that the challenges we face – from combatting climate change, pandemics, and fragility to eliminating extreme poverty and promoting shared prosperity – are deeply intertwined. He has effectively built a broad global coalition around his vision for the Bank over the course of his candidacy," Yellen said in a statement.

"The Board looks forward to working with Mr. Banga on the World Bank Group Evolution process, as discussed at the April 2023 Spring Meetings, and on all the World Bank Group’s ambitions and efforts aimed at tackling the toughest development challenges facing developing countries," the bank said.

While Banga has built a long career in the private sector, especially in finance and banking, he’s highlighted the perspective he could bring to the job from his upbringing and education in India, as well as his commitment to climate science and his belief that poverty and environmental issues are intertwined.

Banga will take over at a pivotal time for the anti-poverty lender, which gives out about $100 billion annually. The US is among nations pushing reforms of multilateral development banks to unlock more climate financing for the developing world.

Banga serves as vice chairman at US investment firm General Atlantic LP. Before that, he spent a decade as president and chief executive officer of Mastercard. He also held various positions at Citigroup Inc., including as CEO of the Asia-Pacific region.

Born in the Pune city of Maharashtra, Banga holds a bachelor's degree in Economics from St. Stephen's College, Delhi University, and a PGP in Management from the Indian Institute of Management-Ahmedabad (IIM-A). In 2016, the Government of India awarded him the fourth-highest civilian award, Padma Shri.

Banga began his career at Nestle, where for 13 years he worked on assignments spanning sales, marketing, and general management. He spent two years with PepsiCo, where he was instrumental in launching its fast-food franchises in India.

Nominating him for the top post at the World Bank, US President Biden, in February, said Banga is uniquely equipped to lead the institution "at this critical moment in history". "He has spent more than three decades building and managing successful, global companies that create jobs and bring investment to developing economies, and guiding organizations through periods of fundamental change," Biden said. "He has a proven track record managing people and systems, and partnering with global leaders around the world to deliver results."
 
The US President had further said Banga has critical experience mobilising public-private resources to tackle the most urgent challenges of our time, including climate change. "Raised in India, Ajay has a unique perspective on the opportunities and challenges facing developing countries and how the World Bank can deliver on its ambitious agenda to reduce poverty and expand prosperity."

With inputs from Reuters