FHM Humayan Kabir
The government would raise its share in the International Bank for Reconstruction and Development (IBRD), one of the five institutions that make up the World Bank, by purchasing some 1,364 more shares, officials said Wednesday last.
Currently Bangladesh has a total of 4,854 shares at the IBRD, nearly 0.37 per cent of its total stake.
"We have decided to purchase the additional shares at the IBRD to raise our stake," said an additional secretary at the Economic Relations Division (ERD).
"We have nearly 0.37 per cent share at this moment in the IBRD. Now we want to raise our stake at the lending arm of the World Bank for strengthening the footprint of the country," said a top ERD official.
Bangladesh is one of the top borrowing countries of the World Bank Group, as it takes nearly $1.2 billion worth of loans every year.
Usually, Bangladesh borrows from the International Development Association (IDA), the soft lending arm of the World Bank Group.
IBRD helps the middle income nations to reconstruct their infrastructure and development work. The bank's service charge is comparatively higher than the IDA as it lends at the market rate to the borrowing countries.
The ERD official said as per the reform plan of the World Bank Group, the IBRD has decided to raise its shares.
According to the plan, the World Bank's hard-term lending window wants to raise its authorised capital issuing 484,102 more shares. Price of each share will be $ 0.1million.
The ERD official said: "Not only the Bangladesh other IBRD member countries will also get shares proportionately from the bank's additional stakes."
He said since Bangladesh is expected to become a middle income nation by 2021, it will require to get financial support from the IBRD too. "So the initiative of raising the country's share will be helpful for the economy."
Meanwhile, Bangladesh has already decided to join the US$100 billion Asian Infrastructure Investment Bank (AIIB), a new lender initiated by the World's second largest economy China.
It also plans to join another proposed global lending institution, being organised by the BRICS nations, to spread up scopes for the poor and middle income countries to get more funds for developing their infrastructure and cutting poverty.
IBRD gets its fund from the capital markets. It has raised the bulk of the money loaned by the World Bank to alleviate poverty around the world.
The IBRD's annual funding volume varies from year to year and it is currently around $10 billion-$15 billion.
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