NITI Aayog bats for structural reforms of MDBs
credit rating agencies and reforming the structure of the multilateral development banks (MDBs) to mobilise funds for green and sustainable growth across developing nations.
“The way forward involves a new toolkit of policies and a reform of the structure of the MDBs to help them engage in capital mobilisation, better project implementation, joint financing, risk sharing and making sustainable infrastructure an asset class,” the Aayog said in its report on a Green and Sustainable Growth Agenda.
The report, developed by NITI Aayog in collaboration with the International Development Research Centre (IDRC), Ottawa, and the Global Development Network (GDN), New Delhi, has been compiled following a G20 international conference on the theme in July this year.
India held the G20 presidency from December 1, 2022 to November 30, 2023.
As per the report, there is a global requirement of $3 trillion over the next decade to finance green growth and hence there is an urgent need to mobilise both public and private finance.
“While the need to finance sustainable growth has been established, the willingness of rich countries to reach deep pockets is being tested as they become cautious of the divided global peace and commitment towards pension for their ageing population,” NITI Aayog vice chairman Suman Bery said.
According to the report, MDBs are struggling with significant performance gaps, transparency issues and the impacts of geopolitics.
“Their effectiveness and efficiency are being undermined, leaving a sizeable void in the financial and technical support required by most developing countries,” it said.
Commenting on the impact of credit rating agencies on developing nations aspiring to fund green and sustainable growth,
