WORLD BANK

Initially, the World Bank was officially known as International Bank for Reconstruction and Development (IBRD). World Bank was only its popular name. IBRD was set up to reconstruct the entire world destroyed during World War II. However, when the responsibility was fulfilled, it was officially renamed as World Bank, and IBRD was made a part of the World Bank.


In the 1960s, International Development Association (IDA) was set up and it was also made a part of the World Bank. Hence, at present World Bank means IBRD + IDA.
Later on, 3 more organizations were brought under the purview of the World Bank. Which are as follows:-
1. International Finance Corporation (IFC)
2. Multilateral Investment Guarantee Agency (MIGA)
3. International Centre for Settlement of Investment Dispute (ICSID)
When IFC, MIGA, and ICSID are clubbed together with World Bank, it is referred to as World Bank Group.
So, World Bank Group means IBRD + IDA + IFC + MIGA + ICSID.



International Bank for Reconstruction and Development (IBRD) 
IBRD was set up with a total capital investment of 14 Billion dollars. It is jointly owned by all member countries. It started providing loans with this amount and a large part of the profit which is made is infused in IDA. Presently, it provides long-term loans to middle-income countries for developmental purposes. For example, projects related to poverty, health, education, environment conservation, etc.
Since 1959, IBRD has enjoyed the highest credit rating because of which it can also borrow from other countries at a lower rate of interest.



International Development Association (IDA)
It also provides long-term loans to the member countries for the same developmental purpose.
However, it provides a loan only to the poorest of the poor country. Hence, the rate of interest is extremely low.
It is funded mainly by IBRD, through its profits. Out of the total members of IBRD, 77 poorest members are provided loans by IDA. Out of them, 39 belong to Africa. IDA provides loans with a maturity of 25-30 years with an additional extension of 5-10 years. India came out of the preview of IDA in November 2014. However, even today Bangladesh is the single largest borrower of IDA and India is in the 2nd position.



International Finance Corporation (IFC)
IFC is the investment wing of the World Bank. It encourages the member countries to provide
investment and encourages private investors to invest in a member country. It even holds a stake in such investment and hence it also shares profit. In order to raise funds for such investments IFC as well as Private Sector Companies may issue bonds that can be sold in the international market.
In order to give indigenous flavor to such bonds, IFC uses certain names for those bonds. For example: - If the fund has to be raised for investment in India, then the bond is named as Masala Bond. On the other hand, if it is to be raised for investment in Japan, the bond is termed a Samurai Bond.



Multilateral Investment Guarantee Agency (MIGA)
MIGA is the insurance wing of the World Bank. It provides insurance coverage to companies investing on the recommendation of IFC in different countries. However, the insurance coverage is provided only against non-commercial risks such as forceful Nationalization.
International Centre for Settlement of Investment disputes (ICSID)  a dispute related to investment takes place between two or more member countries and if
World Bank is also a party to that investment then the settlement is done by ICSID. The decision of ICSID will be binding upon the member countries.

Note :- India has been a member of the World Bank as well as the World Bank group. However, India is not a member of ICSID.

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