By : Neha Dhyani
Updated : Jun 14, 2022, 15:57
India has become a member of the European Bank for Reconstruction and Development [EBRD]. This publicly-owned entity has shareholders from 71 countries and supports nations committed to democracy.
Becoming a shareholder of the EBRD is an effort to expand the country's presence on the global landscape.
An international financial institution founded to focus on the nations of the former Eastern bloc, EBRD stands for the European Bank for Reconstruction and Development.
Headquartered in London, the multilateral development investment bank helps build market economies.
It was founded in 1991 with the initial aim of supporting member countries to establish private sectors. It gradually expanded to support more than 30 nations across continents.
European Bank for Reconstruction and Development [EBRD] membership will widen the scope of cooperation between the country and the institution through co-financing deals in IT, energy, services, and manufacturing.
It will also help leverage the knowledge and technical assistance of the bank for the private sector development.
The membership will strive to enhance the competitive strength of firms and open up new opportunities for professionals across areas.
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Like other investment banks, EBRD's member countries are spread throughout the world and the United States is the one holding the biggest share in the entity.
The member countries are spread across five continents namely Europe, Asia, Africa, Australia, and North America.
It is owned by 71 countries and two institutions of the European Union. The newest shareholder of the bank is Algeria in 2021.
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Apart from its public listing, the institution invests in private projects with commercial partners. The European Bank for Reconstruction and Development [EBRD] mandate applies only to nations committed to adopting the principles of democracy.
Also, the institution supports sustainability and avoids financing tobacco projects, select alcoholic products, gambling facilities, defence-related activities, and items banned by international law.
The European Bank for Reconstruction and Development was founded to help Eastern European and ex-Soviet nations to transition into democratic countries by creating free-market economies.
It helps public companies transition to private entities and supports the restructuring of state-owned firms.
The bank offers financing in the form of trade financing, leasing facilities, loans and equity financing, and others. It finances small to large projects, smaller projects are indirectly funded through intermediaries.
Two international institutions and 71 nations fund the institution. European Bank for Reconstruction and Development [EBRD] gets the financing directly or through intermediaries like investment funds and local banks.
The shareholders of the European Bank for Reconstruction and Development [EBRD] include the European Investment Bank, the European Union, and 71 countries from five different continents. The core fund for the institution is made up of the capital contributions from these shareholders.
Recently, India becomes a shareholder of the European Bank for Reconstruction and Development [EBRD]. It is the 69th of the total 71 shareholder countries across the world.
The membership would help enhance India's international profile and boost investment opportunities, giving better access to international markets and opening up new business opportunities through cooperation.
The European Bank for Reconstruction and Development [EBRD] has its headquarters in London, United Kingdom.
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