SUCCESS STORIES OF THE WORLD BANK

Submitted by
SULAGNA DUTTA
Division.B... PRN..17010323124..Class 2017-22.
Symbiosis Law School, Hyderabad
Symbiosis International University, Pune
In
February, 2020

Under the guidance of

Prof. Nageshwar Rao
Faculty Member
Symbiosis Law School, Hyderabad
Symbiosis International University, PUNE

INTERNATIONAL TRADE AND ECONOMICS

 WHAT IS THE WORLD BANK?
The World Bank Group (WBG) is a consortium of five international organizations that
provide leveraged loans to developing countries. It is the biggest and most well-known
development bank in the world and is an observer to the United Nations Development
Group. The bank is headquartered in Washington, D.C. In the United States of America. The
Bank's stated mission is to achieve the twin objectives of ending absolute poverty and
building shared prosperity. Gross debt over the last 10 years by growth policy funding as of
2015 amounted to approximately $117 billion. The five bodies are the International Bank for
Reconstruction and Development (IBRD), the International Development Association (IDA),
the International Finance Corporation (IFC), the Multilateral Investment Guarantee Agency
(MIGA) and the International Center for the Settlement of Investment Disputes (ICSID). The
first two are sometimes referred to collaboratively as the World Bank.

The major activities of the World Bank are focussed around providing financial
assistance to Developing countries in fields such better utilisation of human resources like
education and health, Agriculture and Rural Development, Environmental protection,
infrastructure, Large industrial projects and activities of governance. The World Bank Group
was formally established on 27 December 1946 following the international implementation of
the Bretton Woods Agreements, which resulted from the United Nations Monetary and
Financial Conference (1–22 July 1944). It also formed the Osiander Committee in 1951,
which was responsible for the preparation and assessment of the World Development Report.
Beginning operations on 25 June 1946. The World Bank currently has two stated objectives
to be accomplished by 2030. The first is to relieve extreme poverty by reducing the numbers
living on less than $1.90 a day to less than 3% of the world's population. The second is to
increase overall productivity by increasing income growth in the bottom 40% of every
country in the world. The World Bank provides qualifying economies with low-interest loans,
zero-interest loans and grants, all with a goal to supporting the development of individual
economies. Debt funding and cash infusions contribute to the development of global
education, health care, public administration, infrastructure and the private sector. The World
Bank also shares information with different entities through expert advice, research and
analysis and technical assistance. This offers advice and training to both the public and
private sectors.
 SUCCESS STORIES OF THE WORLD BANK

Despite the depressing news of the last part of the World Bank's three-part history, the global
financial institution has had a number of successes that have improved the livelihoods and
well-being of millions around the world. The following is the analysis of one of the many
ventures of the World Bank that turned out to be successful or the World Bank.

Development of Global Network of Agricultural Research Centres

In 1971, the World Bank developed a global network of agricultural research centres
resulting in a scientific collaboration and a dramatic increase in agricultural production
through the adoption of innovation. This initiative has enabled countries to better meet the
nutritional needs of their growing populations.

The irrigation industry has been one of the largest beneficiaries of public investment in the
developing world. Seven per cent of World Bank loans, amounting to some 35 billion dollars
in constant US dollars, were for irrigation purposes. Lending for irrigation is now in
downturn: annual lending for the sub-sector and the number of irrigation projects is about
half of what they were during the peak period. Despite this downturn, however, the World
Bank and the regional development banks as well have greatly contributed to the
development of irrigation and to the share of irrigated agriculture in meeting the food
requirements of a rapidly increasing population during the last half-century.

However, the position of the World Bank in the modernization of irrigation has not been as
worthwhile as one would anticipate. The world has changed tremendously over the past fifty
years, and so has the Bank, in its membership, organizational structure, and operation scope
and development agenda. Projects financed by the Bank are now radically different from
those financed in the 1950s, when there was little concern for policy frameworks, poverty
alleviation, environmental protection or the privatization of inputs and services. The World
Bank started lending for agriculture through large irrigation projects, in keeping with the
prevailing emphasis on large infrastructure. In the 1950s and the 1960s, the Bank did not
finance rehabilitation works of existing irrigation systems.
The food crisis in India in the mid-1960s focused attention on the need to improve food-grain
productivity and new technologies. The Bank began lending for agricultural research and
extension, rural credit and the production of high-yielding varieties and fertilizers, either
directly through specific agricultural projects or as components of irrigation projects. In the
1970s, under the presidency of Robert MacNamara, the Bank turned its energies to
alleviating poverty. Irrigation projects became overloaded with rural development
programmes, such as construction of rural roads, schools and health centres. Irrigation
projects became very difficult to prepare and implement because of the number of sub-
components and agencies involved. Since 1976, the Bank's internal regulations require that
project preparation be upgraded to completion of detailed design and bidding documents for
presentation to the Board to avoid delay in implementation and to reduce the risks of cost
overruns. Post evaluations showed that many irrigation projects did not comply with this
requirement and if they did, emphasis was on the structural design of infrastructure, not on
canal operation and delivery of water to the users.

By the 1980s, it became evident that faulty policies seriously affected production in many
countries. It also became apparent that competition for water was acute in many countries,
water quality was seriously affected and water-related issues could no longer be treated
separately by each sub-sector. In 1993, the Board of Directors of the Bank approved its Water
Resources Management Policy, which encourages the adoption of institutional reforms,
analytical frameworks for managing water resources, water conserving technology,
decentralization of responsibilities to local governments, user participation and environmental
protection. The water policy marked a turning point in the formulation of irrigation projects,
which progressively shifted from the agricultural sector to the water sector.

In the early decades of lending for irrigation, the Bank financed specific individual projects
or a group of subprojects which were all well identified. The attention now given to the
recommendations of the water policy has contributed to shift the Bank-supported irrigation
programmes to projects national or regional in scope. For example, some projects cover the
entire irrigated area of a state in India or a province in Pakistan or even the entire multiple-
year plan of a country, such as in Mexico. A "new-style" project typically includes two major
components: an institutional component supporting the creation or strengthening of water
user associations and reforms of irrigation and water agencies, and a physical component for
rehabilitation or differed maintenance work. Depending on the needs of the project, financing
of environmental studies, agricultural research or support services or creation of basin
agencies are also included. The main focus is on the software recommendations of the water
policy such as the participation of users or the legal framework enabling the setting up of
water rights and water markets.

CONCLUSION

Over the past decade, the World Bank has become the leading international institution for
development financing and for elaborating new development strategies. The International
Development Association. As a complement to the IBRD, the IDA was established in
1960 to promote broad-based development work in the world’s poorest countries by
offering interest-free credits and grants. The IDA currently has programs in sixty-nine
countries, of which thirty-seven are in Africa, with a focus on education, health, and
sustainable environmental practices. This has involved a major shift in lending toward
agriculture and rural development. Explanations for the change range from more progressive
expertise within the Bank to the shock of the 1972-74 food crisis and renewed penetration of
Third World agriculture by capitalist agribusiness. Discriminating among these perspectives
requires attention to the core issue of the relationship between increasing food production and
reducing rural poverty. The issue is irreducibly political, and the Bank's record is less
encouraging than the reformist rhetoric.