The Asian Infrastructure Investment Bank (AIIB) is a multilateral development bank that funds infrastructure projects in Asia and beyond. It is one of the newer global lenders. Here is how it works.
History
China proposed the bank in 2013. The Articles of Agreement were signed in 2015, and the AIIB began operations in January 2016. Its headquarters is in Beijing.
The bank started with 57 founding members, including India. Its membership has since grown to more than 100 approved members from Asia, Europe, Africa, the Americas and Oceania.
Shareholding
Voting power is based on shares, with regional members holding the majority. China is the largest shareholder, and India is the second largest. Other large shareholders include Russia, Germany and South Korea. The United States and Japan are not members.
How it is run
- **Board of Governors:** the highest body, with one governor per member
- **Board of Directors:** non resident directors who approve policies and projects
- **President:** heads the bank, elected for a five year term
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What AIIB funds
AIIB focuses on sustainable infrastructure, including:
- Energy and power, especially renewable energy
- Transport, such as roads, metro and rail
- Water and urban development
- Digital infrastructure
- Climate related projects
It often co finances projects with the World Bank, the Asian Development Bank and other lenders.
AIIB and India
India is a founding member and the second largest shareholder. India has also been the largest borrower from the AIIB, with funding for projects such as:
- Metro rail projects in cities like Bengaluru, Mumbai and Chennai
- Rural roads and state highways
- Power transmission and renewable energy
- Water supply and irrigation
- Support during the Covid health emergency
India hosted the third AIIB Annual Meeting in Mumbai in 2018, where infrastructure financing in India and the region was a key theme.
How it differs from other banks
- The World Bank and ADB are older and larger, with broader development goals.
- The AIIB focuses mainly on infrastructure.
- The New Development Bank, set up by BRICS countries, is a separate institution based in Shanghai.
Bottom line
The AIIB is a young but large infrastructure lender. India, as its second largest shareholder and biggest borrower, plays a major role in it.
Source / स्रोत: Asian Infrastructure Investment Bank, Department of Economic Affairs
