IBRD (International Bank for Reconstruction and Development) and IDA (International Development Association) together make up the World Bank. Which of the following statements correctly distinguishes the two ?
1. IBRD raises most of its funds through capital markets, while IDA is funded through contributions by governments of the member states.
2. Contributions to the IBRD affect the voting power of the member states in the World Bank, while contributions to IDA do not affect the voting power.

Select the answer using the code given below:
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2

Question

IBRD (International Bank for Reconstruction and Development) and IDA (International Development Association) together make up the World Bank. Which of the following statements correctly distinguishes the two ?
1. IBRD raises most of its funds through capital markets, while IDA is funded through contributions by governments of the member states.
2. Contributions to the IBRD affect the voting power of the member states in the World Bank, while contributions to IDA do not affect the voting power.

Select the answer using the code given below:
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2

ONLiNE UPSC · Accepted Answer

Statement 1 is correct: IBRD raises most of its funds from the world financial/capital markets. The IBRD borrows at an attractive rate on the capital markets because of its AAA rating that it has had since 1959. IDA is funded largely by contributions from the governments of its member countries. Additional funds come from IBRD and International Finance Corporation (IFC).

Statement 2 is not correct: The voting power of the member countries in the World Bank is based on the economic size (GDP) in addition to their contribution to the IDA.

International Organizations

World Bank - IBRD and IDA

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M Question 1	⏱ 0
IBRD (International Bank for Reconstruction and Development) and IDA (International Development Association) together make up the World Bank. Which of the following statements correctly distinguishes the two ? 1. IBRD raises most of its funds through capital markets, while IDA is funded through contributions by governments of the member states. 2. Contributions to the IBRD affect the voting power of the member states in the World Bank, while contributions to IDA do not affect the voting power. Select the answer using the code given below: (a) 1 only (b) 2 only (c) Both 1 and 2 (d) Neither 1 nor 2