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Asian Infrastructure Investment Bank (AIIB) UPSC NOTE


  • The Asian Infrastructure Investment Bank (AIIB) is an international financial institution established in 2016.

  • Started in 2016 with 57 founding members, the AIIB now has more than 100 members

  • It is headquartered in Beijing, China.

  • The AIIB aims to support infrastructure development and promote economic growth in the Asia-Pacific region.

Role of AIIB

  • The primary role of AIIB is to provide financing for infrastructure projects in its member countries.

  • AIIB emphasizes sustainable development by integrating environmental and social considerations into its investment decisions.

  • AIIB collaborates with other development institutions, governments, and private sector entities to co-finance projects and leverage additional resources.

  • AIIB provides technical assistance and knowledge sharing to help member countries build capacity and develop sustainable infrastructure projects.

  • AIIB engages in policy dialogue with governments and stakeholders to promote best practices in infrastructure development and improve governance.

Voting Share

  • AIIB's voting power is determined by the number of shares held by its member countries.

  • China holds the most voting power with 26.58%

  • China having contributed $27 billion

  • India is the bank’s second largest shareholder with a 7.6% voting power, and committed $8 billion

  • After China and India, Russia holds the bank’s third largest voting power (5.97%), followed by Germany (4.15%), South Korea (3.49%), Australia (3.45%), France (3.17%), Indonesia (3.16%) and the U.K. (2.89%)

Why Canada halted the involvement in AIIB?

  • Canada's decision to halt its involvement in the AIIB came after the sudden resignation of a Canadian executive who raised concerns about the bank's governance.

  • The Canadian executive stated that the AIIB was being "dominated" by members of China's ruling Communist Party, which raised questions about the bank's independence and decision-making processes.

  • Chinese officials strongly rejected the claims made by the Canadian executive, dismissing them as "outright lies" and "sensational hype."

  • China holds the highest voting power in the AIIB with 26.58%, followed by India with 7.6%.

  • The AIIB has been described as a potential rival to institutions like the World Bank and the Asian Development Bank (ADB), but its capacities and capabilities are often overstated. 

  • Many of the bank's early projects were co-funded with the World Bank or the ADB.

India and AIIB

  • The establishment of the AIIB was seen as a diplomatic achievement for China, as it attracted countries like India that were wary of China's Belt and Road Initiative (BRI).

  • India joined the AIIB while staying away from the Belt and Road Initiative (BRI), as it viewed the two initiatives as separate. 

  • India saw the AIIB as a transparent, multilateral institution, unlike the BRI, which raised sovereignty concerns due to its inclusion of the China Pakistan Economic Corridor (CPEC).



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Learnerz IAS | Concept oriented UPSC Classes in Malayalam: Asian Infrastructure Investment Bank (AIIB) UPSC NOTE
Asian Infrastructure Investment Bank (AIIB) UPSC NOTE
Learnerz IAS | Concept oriented UPSC Classes in Malayalam
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