BRICS Bank a ‘Worthwhile Venture’, off to Good Start: RBI Guv Rajan

PTI, Shanghai

Describing the New Development Bank (NDB) set up by the BRICS countries as a “worthwhile venture”, RBI governor Raghuram Rajan on Saturday said the multilateral bank has gotten off to a good start raising hopes of energising the investment and financing of infrastructure projects.

“It is off to a good start. Let us all wish it a success and see where it goes. Hopefully, it energises more investment and financing in infrastructure,” Rajan said.

“It is a co-operative effort between all BRICS countries. We have already reached contingency reserve agreement (CRA). This is second. Let’s see how it develops. Lots of hopes embedded in it for greater cooperation (among the) BRICS countries,” he told reporters during a brief interaction.

The RBI governor termed the setting up of the bank by BRICS members – Brazil, Russia, India, China, South Africa (BRICS) – a “worthwhile venture.”

Rajan, who attended a special ceremony when agreements to place the NDB headquarters in Shanghai was signed, is in the city to attend G20 finance ministers and central bank governors meet.

Terming NDB a primary platform for cooperation among the BRICS countries, Chinese foreign minister Wang Yi said the members will continue to play an influential role in global economic and political scene, despite the slowdown in most of the countries in the grouping.

India, expected to grow at 7 or 7.5% this year, is the only member that posted better growth rate while others in the bloc including China grappled with slowdown.

“We have heard some comments and suspensions about the BRICS cooperation at the moment. Indeed, we are facing some downward pressures. But this is not confined to the BRICS counties alone but to the entire world,” Wang said.

“We believe that the growth potential and prospects of growth drivers that bricks countries enjoy are still there. As a major developing countries representing the emerging markets in the world, the general picture has not changed. BRICS countries influence in the international, political and economic affair swill continue to rise,” he said.

He said China will extend full cooperation to India which heads the grouping. China takes over its presidency in 2017.

“Next year, when China take the presidency we aim to work with other members of the BRICS countries to ensure economic and political cooperation. We believe that BRICS cooperation will continue to enjoy the lustre and will enjoy even better future,” he said.

NDB began functioning in Shanghai last year. The NDB is established with an initial subscribed capital of USD 50 billion and a total paid-in capital of $10 billion.

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