The international bank of reconstruction and development (IBRD) is commonly known as World Bank. The main aim of IBRD is to reconstruct the war affected economies of Europe and assist the development of under developed economies of world. The World Bank after 1950 concentrated more on underdeveloped countries and invested more into social sectors like health and education of such under developed countries. For this purpose the International Development Association (IDA) was formed in 1960. This IDA provided loan at concessional rates to those countries whose per capita income are lesser then a critical level. The borrowing country need not pay any interest on the borrowed amount. IDA, hence, gives long-term interest free loans to the poor countries. IBRD also provides loans but they have interest charged on commercial basis. Over the course of time, additional bodies have been established under the World Bank. At the present moment, the World Bank comprises of five international bodies accountable for offering finance to different nations. These bodies and its associates headquartered in Washington DC catering to different financial requirements are mentioned in the Box A on World Bank and its associates. As mentioned earlier, the World Bank is assigned the task of economic growth and increasing the scope of foreign trade. During its initial years of establishment, it gave more importance on developing infrastructure facilities like transportation, energy, and others. All this has benefited the under-developed countries too with no doubt, but due to poor administrative structure, lack of institutional framework and lack of availability of skilled labour in these countries has led to satisfactory results. Additionally, since the underdeveloped.
World Bank and its Affiliates
International Bank for Reconstruction and Development (IBRD) 1945
International Financial Corporation (IFC) 1956
International Development Association (IDA) 1960
Multilateral Investment Guarantee Agency (MIGA) 1988
International Centre for Settlement of Investment Disputes (ICSID) 1966
Nations rely largely on agriculture and small scale industries, the effort to develop infrastructure did not have any effect on these two sectors. With this in mind, the World Bank henceforth decided to redirect resources to bring about industrial and agricultural development in such nations. Aid in different forms is extended to various nations for cultivating cash crops so that their incomes increase and they may export the same for earning foreign exchange. The bank has also been offering resources for education, health care, sanitation, and other small scale enterprises. Presently, the services provided by the World Bank have increased by many times. The World Bank is no longer restricted to just offering financial aid for infrastructure development, agriculture, industry, health and sanitation. It is rather considerably involved in areas like elimination of rural poverty by increasing productivity, increasing income of the rural poor, offering technical support, and starting research and cooperative schemes.