AIIB, ACU, Asian Development Bank(ADB) Notes For UPSC 2021-22

About AIIB

AIM: To support the building of infrastructure in the Asia-Pacific region

The Asian Infrastructure Investment Bank (AIIB) is a multilateral development bank (MDB) conceived for the 21st century.  Its modus operandi will be lean, clean and green:

  • Lean, with a small efficient management team and highly skilled staff.
  • Clean, an ethical organization with zero tolerance for corruption.
  • Green, an institution built on respect for the environment.

The bank has 57 member states (all “Founding Members”) and was proposed as an initiative by the  government of China

Headquarters: Beijing, China (January, 2016)

About Asian Development Bank(ADB)

Aim: To promote social and economic development in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration.

The bank admits the members of the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP, formerly the Economic Commission for Asia and the Far East or ECAFE) and non-regional developed countries. From 31 members at its establishment, ADB now has 67 members, of which 48 are from within Asia and the Pacific and 19 outside.

Headquarter: Manila, Philippines (Dec, 1966)

Report Published:  Asian Development Outlook

  • The ADB offers “hard” loans on commercial terms primarily to middle-income countries in Asia and “soft” loans with lower interest rates to poorer countries in the region (Known as Sovereign Lending).
  • ADB provides direct financial assistance, in the form of debt, equity, and mezzanine finance to private sector companies, for projects that have clear social benefits beyond the financial rate of return

About ACU

Asian Clearing Union (ACU) is a payment arrangement whereby the participants settle payments for intra-regional transactions among the participating central banks on a net multilateral basis. The main objectives of the clearing union are to facilitate payments among member countries for eligible transactions, thereby economizing on the use of foreign exchange reserves and transfer costs, as well as promoting trade and banking relations among the participating countries.

Headquarters: Tehran, Iran (Est. December, 1974)

Member States:

Bangladesh, Bhutan, India, Iran, Maldives, Myanmar, Nepal, Pakistan, Srilanka

Eligible transactions

The monetary transactions eligible to be settled through the Asian Clearing Union includes the following:

  • Payments from the resident in the territory of one participant to a resident in the territory of another participant.
  • Payment for current international transactions as defined by the Articles of Agreement of the International Monetary Fund.
  • Payment permitted by the country in which the payer resides.
  • Payment which are in compliance with FEMA 1999, rules, regulations, orders or directions issued there-under and the specific provisions of the Memorandum ACM.
  • Payment for exports and/or import transactions between ACU member countries on deferred payment terms.

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