FM seeks AIIB help for next gen reforms

Finance minister Nirmala Sitharaman on Monday called on the Asian Infrastructure Investment Bank (AIIB) to widen its investments in climate adaptation and resilience, infrastructure development, energy security and urban development, and also extend its support for India's next generation reforms.

Sitharaman, the current governor on the AIIB board, held a meeting with a high-level AIIB delegation in New Delhi.

She also underscored the importance of continually incorporating in AIIB's project design and implementations elements that are beyond just financing, the finance ministry said in a statement.

The AIIB had approved a total of $50.4 billion in financing as of March 2024. India is the largest borrower, with the AIIB having approved 48 projects in the country involving $10.45 billion. The government has announced plans to keep pursuing next-generation structural reforms to sustain the high economic growth rate.

India remains the world's fastest-growing major economy. The International Monetary Fund has pegged India's growth rates at 7% this fiscal and 6.5% in the next, more than double the global averages.

Sitharaman asked AIIB to strive for greater innovative financial tools and models and scale up its efforts for private capital mobilisation, while extending India's full support. India could act as a sandbox for the AIIB's piloting of innovative financing models and technologies, she added.

India, the minister affirms, remains committed to governance reforms in multilateral development banks (MDBs) to ensure that they are "fit for purpose to address contemporary challenges, while remaining inclusive and responsive to the needs of all members, particularly of low-income countries". She asked the AIIB to join the efforts towards reforming the MDBs.

"Appreciating the AIIB for its remarkable growth over the past nine years, the minister underlined India's strong macroeconomic fundamentals and its demonstrated leadership in creating and harnessing the power of digital public infrastructure," the ministry said.

India's experience of digital transformation, Sitharaman stressed, can "serve as a model for other countries seeking to harness digital solutions for inclusive growth".