UPSC Prelims 2019 Q71: Indian Economy – International Institutions & Reports
- (a) 1 only
- (b) 2 and 3 only
- (c) 1 and 3 only
- (d) 1, 2 and 3
Answer: (a) 1 only
Explanation
Asian Infrastructure Investment Bank (AIIB)
| Statement | Claim | Verdict | Detail |
|---|---|---|---|
| 1 | AIIB has more than 80 member nations | TRUE | AIIB has 100+ approved members (as of 2019 already 80+; grown further since). India is a founding member. |
| 2 | India is the largest shareholder | FALSE | China is the largest shareholder (~26.5%). India is the SECOND-largest (~7.5%). |
| 3 | AIIB has no non-Asian members | FALSE | AIIB has regional (Asian) and non-regional (European, African, Latin American) members - UK, Germany, France, Italy, Canada, Australia, Brazil, Egypt etc. are members. |
Only statement 1 is correct. Answer: (a) 1 only.
Answer: (a) 1 only.
Why each option is right or wrong
- (a) CORRECT. AIIB has 80+ members (100+ including approved). China is largest shareholder (not India); non-Asian members are also present.
- (b) Incorrect. India is second-largest, not largest. Non-Asian members exist.
- (c) Incorrect. AIIB has non-Asian members.
- (d) Incorrect. Statements 2 and 3 are wrong.
Key point
AIIB (2016, Beijing HQ): 100+ members. China largest shareholder (~26.5%), India second (~7.5%). Has non-Asian members (UK, Germany, Canada, Australia etc.). India is largest borrower to date.
Remember
Only statement 1 is correct. AIIB has more than 80 member nations (100+ including approved). China is the largest shareholder (~26.5%), NOT India (which is second at ~7.5%). AIIB has many non-Asian members including UK, Germany, France, Canada, Australia and Egypt.
Common mistakes
- Confusing AIIB (China-led) with NDB (BRICS Bank, Shanghai HQ, equal 20% shares).
- Assuming India is the largest anything at AIIB - India is 2nd largest shareholder, 1st largest borrower.
- Not knowing AIIB has funded India's Mumbai Metro, Bangalore Metro, Andhra Pradesh irrigation projects.
Exam tip
Multilateral development banks India engages with: World Bank (US-led, HQ Washington). ADB (Japan-led, HQ Manila). AIIB (China-led, HQ Beijing). NDB (BRICS, HQ Shanghai). IMF (Washington, monetary crises). India is a major borrower from AIIB and ADB.
Sources
- Asian Infrastructure Investment Bank — Articles of Agreement (2015): subscriptions and voting power
- Ministry of Finance - India's engagement with AIIB