Asian Infrastructure Investment Bank: Features, Organization Structure, Objectives and More

The Asian Infrastructure Investment Bank found no evidence to support or validate allegations made by its former communications chief that it is controlled by the Communist Party of China, it said in a statement, following an investigation.

What is Asian Infrastructure Investment Bank (AIIB)?

• The Asian Infrastructure Investment Bank (AIIB) is an international development bank with the stated goal of improving social and economic conditions throughout Asia.
• The creation of the AIIB was led by China, which maintains a controlling interest in the bank’s operations.
• The AIIB is headquartered in Beijing
• It commenced operations in January 2016.
• Its current president is Chinese banker Jin Liqun.

Asian Infrastructure Investment Bank Features

• Starting with 57 founding members, the bank now has 106 approved members.
• Membership to the bank is open to all members of the Asian Development Bank or the World Bank.
• The bank also allows non-sovereign entities to apply for membership provided their home countries are members.
• The Board of Governors of the bank consists of a governor and an alternate governor of each member country. The Board is the highest decision-making body of the AIIB.

Organizational Structure Of Asian Infrastructure Investment Bank

AIIB President

• Jin Liqun is the inaugural President and Chair of the Board of Directors.
• On July 28, 2020, he was elected to serve a second term of five years, beginning on Jan. 16, 2021.
• Before being elected as the Bank’s first President, he served as Secretary-General of the Multilateral Interim Secretariat tasked with establishing the Bank.
• Jin has rich experience across the private and public sectors and with MDBs.
• He served as Chair of the China International Capital Corporation Limited (China’s first joint-venture investment bank), Chair of the Supervisory Board of the China Investment Corporation, and Chair of the International Forum of Sovereign Wealth Funds.
• He previously served as Vice President and then Ranking Vice President of the Asian Development Bank and as Alternate Executive Director for China at the World Bank and at the Global Environment Facility.
• Jin spent nearly two decades at the Chinese Ministry of Finance, reaching the rank of Vice Minister.
•  
• Jin is from the People’s Republic of China.

Objectives Of Asian Infrastructure Investment Bank

1. Promoting sustainable economic development, creating wealth, and augmenting infrastructure connectivity in Asia by investing in infrastructure & other productive sectors.
2. Fostering regional partnership & cooperation to address developmental challenges by working in tandem with other bilateral and multilateral developmental institutions.
3. Enhancing investment in private & public capital for development purposes.
4. Using the resources at its disposal for funding development in the region, including projects that will contribute to the balanced economic growth of the region.
5. Promoting private investment in enterprises, activities and projects contributing to economic development in the region wherever private capital is not available.

Asian Infrastructure Investment Bank Shareholders

• China is the main shareholder of AIIB. It commands 27 per cent voting power.
• This is considerably greater than India, the second-largest shareholder, which holds eight per cent.
• This is the largest gap between the top two shareholders at any existing multilateral development bank.
• Russia is the third largest, followed by Germany, South Korea, Australia, France, Indonesia, the United Kingdom and Turkey.

India And Asian Infrastructure Investment Bank

• The AIIB has funded 28 projects in India.
• These projects are worth $6.7 billion in total. The projects are in various sectors like energy, transport, water and others. The bank has reportedly approved $500 million for Covid-19 Emergency Response Fund.
• India and the AIIB signed a $455 million loan agreement to finance Andhra Pradesh Rural Roads Project.

China And AIIB

• China’s leader Xi Jinping first proposed an Asian infrastructure bank at an APEC summit in Bali in
• The Asian Infrastructure Investment Bank was created with the purpose of serving as a regional financing tool for Chinese President Xi Jinping’s “One Belt, One Road (OBOR)” initiative.
• In this bank’s case, China controls half of the bank’s voting shares, which gives the perception that the AIIB will function in the interests of the Chinese government.
• The U.S. has questioned the bank’s governing standards and its social and environmental safeguards, perhaps pressuring allies not to apply for membership.
• However, despite American objections, approximately half of NATO has signed on, as has nearly every large Asian country, with the exception of Japan.
• The result is widely considered in an indicator of China’s growing international influence at the expense of the United States.

To Download Monthly Current Affairs PDF Click here

Get Inspiration from CLAT 2024 Topper

Click here to get a free demo

Everything About CLAT 2025