Banking Khabar / The Asian Infrastructure Investment Bank (AIIB) is one of the international banking projects that has been launched to mobilize large investments for global infrastructure development and provide support to countries worldwide. The bank has made significant investments in many countries, including Nepal. Established under the leadership of China, the AIIB is a multilateral development bank aimed at improving the social and economic conditions of Asia and Oceania by financing infrastructure development and other productive activities. Its headquarters is located in Beijing, China.
Operational since January 2016, the bank has nearly 100 approved members worldwide. The AIIB has received top ratings from three renowned independent credit-rating agencies. It is seen as a financial source for projects under China’s Belt and Road Initiative, which is a major part of President Xi Jinping’s vision. It is also considered a competitor to the World Bank and the Asian Development Bank.
The AIIB has become a reliable new source of investment for countries across the globe. To date, the bank has approved 45 projects in 18 member countries, with investments totaling $8.5 billion USD. The bank has primarily focused its investments on sectors such as energy, transportation, drinking water, waste management, urban infrastructure, and information technology. In Nepal, the bank has invested $396 million USD in the 216 MW Upper Trishuli Hydroelectric Project, with a total cost of $640 million USD. Additionally, the bank has provided $900,000 USD in grants for the preparation of the Tamakoshi V Hydroelectric Project and $1 million USD in loans for strengthening Nepal’s electricity transmission lines.
The concept of the AIIB was first publicly introduced by Chinese President Xi Jinping during a visit to Indonesia in 2013. The initial idea was to increase foreign exchange reserves in China during the global economic downturn. At the Boao Forum in 2014, Chinese Premier Li Keqiang expanded the bank’s concept to include countries outside of Asia. The agreement for the bank’s establishment was signed on June 29, 2015, and came into effect on December 25, 2015. With an authorized capital of $100 billion USD, the bank’s paid-up capital stands at $20 billion USD. The AIIB has 100 member countries, including Nepal, and is led by China, which holds a 30% stake in the bank. Other major investors include Germany, Russia, the United Kingdom, and countries like India, Russia, South Korea, Australia, and France.
