The International Bank for Reconstruction and Development (IBRD) In 1944, at the height of the Second World War,

representatives from 44 countries / governments, met at Bretton Woods in New Hampshire and reached an agreement to establish two Multinational Institutions, 1. The International Monetary Fund (IMF) 2.The World Bank. The official name of the World Bank is IBRD (International Bank for Reconstruction and Development) The Articles of Agreement became effective on December 31, 1945 upon signature by twenty-eight governments. On June 25, 1946, the International Bank for Reconstruction and Development, known commonly as the World Bank, opened for business. The Countries were Australia, Belgium, Bolivia, Brazil, Canada, Chile, China, Colombia, Costa Rica, Cuba, Czechoslovakia, Dominican Republic, Ecuador, Egypt, El Salvador, Ethiopia, France, Greece, Guatemala, Haiti, Honduras, Iceland, India, Iran, Iraq, Liberia, Luxembourg, Mexico, The Netherlands, New Zealand, Nicaragua, Norway, Panama, Paraguay, Peru, Philippines, Poland, South Africa, USSR, United Kingdom, United States, Uruguay, Venezuela and Yugoslavia. India was among the original participants of the 1944 Bretton Woods conference which conceived the idea of the International Bank for Reconstruction and Development .In fact it was the India delegation which first suggested the name IBRD. The Banks New Delhi office, established in 1957, is the oldest continuously functioning World Bank country office. The devaluations and inflationary tendencies that characterized the interwar years and the fear of a post-war economic depression had been the genesis of the conference and the Fund proposal. The Bank was conceived of primarily as an instrument through which the physical assets of the post-war world might be rebuilt. Development financing was

envisaged as an activity in which the Bank would ultimately but not immediately engage. It was the Latin American countries which were principally responsible for the emphasis on development. Not being themselves in need of reconstruction, they suggested that equal amounts be expended for the two objectives. The banks initial mission to finance the reconstruction and rebuilding of the war torn economies of Europe by providing low interest loans to the member countries was also overshadowed in this role by the Marshall Plan under which the United States lent money directly to the European nations to help them rebuild their economies .So the bank turned its attention to Development and began lending to the nations of the third world . Today, World Bank is made up of two unique development institutions owned by 187 member countries. 1. The International Bank for Reconstruction and Development (IBRD) 2. The International Development Association (IDA) which was set up in 1960 as an affiliate of the World Bank. The other institutions of the World Bank Group are The International Finance Corporation , The Multilateral Investment Guarantee Agency (MIGA) The International Centre for the settlement of Investment Disputes). Total member countries in each institution The International Bank for Reconstruction and Development (IBRD) The International Development Association (IDA) The International Finance Corporation (IFC) 187 170 182

The Multilateral Investment Guarantee Agency (MIGA) The International Centre for Settlement of Investment Disputes (ICSID)

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The World Bank is a vital source of financial and technical assistance to all its member countries especially the developing and least developed countries around the world. The IBRD and its affiliate The International Development Association (IDA) provide low or no interest Loans (credits) and grants to countries that have unfavorable or no access to international credit markets. Unlike other financial institutions, the World Bank does not operatefor profit.

Fund Generation The major proportion of its income comes from lending out its own capital. This capital consists of reserves built up over the years and money paid to the bank by its 185 member country shareholders. IDA is the world's largest source of interest free loans and grants assistance to the poorest countries. IDA's funds are replenished every three years by 40 donor countries. IDA accounts for more than 40% of our lending. The World Bank funds two basic types of financing operations 1. Investment operations and 2. Development policy operations.

1. Investment operations provide funding (in the form of IBRD loans or IDA credits and grants) to governments to cover specific expenditures, related to economic and social development projects in a broad range of sectors. Projects range from urban poverty reduction to rural development, water and sanitation, natural resource management, postconflict reconstruction, public finance management, education and health .The loans aim at creating the physical and social infrastructure necessary to reduce poverty and create sustainable development. Over the past two decades, investment operations have, on average, accounted for 75 to 80 percent of the Bank's portfolio. The nature of investment operations has changed over time. Originally focused on hardware, engineering services, and bricks and mortar, investment lending and grants have come to focus more on institution building, social development, and improving the public policy infrastructure needed to strengthen private sector activity. Eligibility. Investment operations are available to International Bank for Reconstruction and Development (IBRD) and International Development Association (IDA) borrowers who are not in arrears with the Bank Group. Disbursement. Funds are disbursed against specific foreign or local expenditures related to the investment project, including pre-identified equipment, materials, civil works, technical and consulting services, studies, and incremental recurrent costs. Procurement of these goods, works, and services is an important aspect of project implementation. To ensure satisfactory performance, the loan or credit agreement may include conditions of disbursement for specific project components. Projects Financed by World Bank

India - Maharashtra Agricultural Competitiveness Project

WASHINGTON, September 28, 2010 - The World Banks Board of Executive Directors approved the following project: IDA Credit: US$100 million equivalent Terms: Maturity = 40 years; Grace = 10 years Project Description: The objective of the project is to increase the productivity, profitability, and market access of the farming community in the state of Maharashtra. Farmers will be assisted through farmer organizations; alternative market channels developed outside of regulated markets, and improved services provided by modernizing promising traditional wholesale markets. Mizoram State Roads Project-(Additional Financing) WASHINGTON, October 21, 2010 - The World Banks Board of Executive Directors today approved the following project: IDA Credit: US$13 million equivalent Terms: Maturity = 35 years; Grace = 10 years Project Description: The additional financing will improve the management and carrying capacity of the Mizoram core state road network.

2. Development Policy operations provide direct budget support to governments for policy and institutional reforms aimed at achieving a set of specific development results. Development policy lending replaced "adjustment lending" in 2004. Development Policy operations provide rapid financial assistance to allow countries to deal with actual or anticipated development financing requirements of domestic or external origins. They typically support the achievement of a set of development results through a medium-term program of policy and institutional actions consistent with a country's economic and sectoral priorities and reforms. In Fiscal Year 2008, IDA and IBRD development policy operations accounted for 27 percent of total Bank commitments; in Fiscal Year 2009 they were at 40 percent as the Bank supported countries in their response to the financial crisis.

Eligibility. Eligibility for a development policy operation requires agreement on monitor able policy and institutional reform actions, and maintenance of a sound macroeconomic policy. Disbursement. Funds are disbursed in one or more stages (tranches). Tranches are released upon a satisfactory assessment of performance against a set of indicators in the form of institutional or policy reform measures that reflect progress in implementing a country-owned reform program.

According to the World Bank ,the total IBRD/IDA Commitments to India as on June 30, 2010 stood at $21.4 billion US $.

India received roughly half of its World Bank loans interest free. These are provided by the Banks International Development Association. This agency provided grants and credits, which are loans at zero interest, with a 0.75 percent finance charge. The remaining half of World Bank loans to India were provided by the International Bank for Reconstruction and Development, at low interest rates. Countries that borrow from the IBRD have more time to repay than if they borrowed from a commercial bank. They get 15 to 20 years for repayment with a three to five year grace period before the repayment of principal begins. India remains the Banks largest single borrower. Its lending to India touched $2.9 billion in 2005 which is more than double the amount lent in 2004. The bulk of new lending has gone to much needed infrastructure and human development projects, reflecting the rapid growth of India's economy. World Bank is the largest financier of Indias National Aids Control Program (NACP) with a commitment of around US$275 million in interest-free credits. Its assistance has helped the government develop its ability to manage HIV/AIDS programs at the central and state level and has enabled important gains in improving blood safety, expanding surveillance to understand the scope of the problem, and scaling up activities aimed at prevention and treatment. With support from the World Bank and other donors, the government set up state AIDS bodies in 25 states and seven Union territories. Technical Assistance The world bank also renders technical assistance to member countries .For example in the case of India for 50 years, World Bank assistance to Indias energy sector has covered oil and gas, coal, power projects and alternative sources of energy. It has been a key

partner in the governments efforts to develop its national power grid, and has provided technical assistance aimed at increasing the access of poor people to electricity and clean, affordable fuel.