📚 JAIIB · IE & IFS · Module A · Chapter 9
International Economic Organisations
IMF (190 members, formed July 1944), World Bank Group (5 institutions), WTO (164 members, HQ Geneva) and 12 regional organisations — the institutions that govern global economic cooperation, and why India matters in all of them.
⏱ 18 min read🎯 Very High Exam Weightage🌐 IMF + WB + WTO⚡ Flash Cards Inside
Section 1-3 — Overview and Why This Matters
Global institutions that shape India’s banking and economic policies
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Sir, these are global institutions — how does this relate to my daily banking work?
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The IMF shapes India’s monetary policy and exchange rate norms — conditions it imposed shaped the 1991 LPG reforms that created modern Indian banking. The World Bank directly funds Indian government projects your bank participates in — PMKSY irrigation, National Ganga River Basin, Sagarmala port development. The WTO rules determine what goods India can export, what tariffs it pays — affecting export finance clients. The SAARC, ASEAN and G-20 shape India’s trade partnerships — which determine demand for your trade finance products.
Three big institutions — IMF (monetary), World Bank Group (development), WTO (trade)
Section 4 — Key Definitions and Details
IMF, WBG five institutions, SDR, WTO, Regional Orgs — all from the textbook
IMF — Eight Functions (as per PDF)
| Function | Description |
|---|---|
| (a) Surveillance | Supervises members’ economic policies; reviews economic situations of nearly every country regularly |
| (b) BoP Financing | Loans to member countries during temporary BoP crisis; assists in mobilising external funding |
| (c) Poverty Combat | Concessional loans to poor countries; collaborates with WB; participates in HIPC and MDRI initiatives |
| (d) Mobilise Financing | IMF endorsement needed before bilateral/multilateral lenders commit resources; provides signals to investors |
| (e) Strengthen IMS | Key institution of international monetary system; forum for consultation on monetary/financial issues |
| (f) International Reserves | Established Special Drawing Rights (SDRs) in 1969 to augment international liquidity |
| (g) Technical Assistance | Offers technical support and training to member nations on economic policy and management |
| (h) Research & Information | Conducts economic analyses, compiles statistics, produces estimates; disseminates through reports and journals |
India and IMF — Key Facts
India’s IMF Membership
- India became member on December 27, 1945
- India is a founding member of IMF
- Finance Minister is ex-officio Governor on Board of Governors
- In 1970, India was among five countries with highest IMF quotas → permanent seat on executive board
- IMF served as crisis manager and crisis lender for India
- During 2008 global financial crisis: India got US$4.5 billion from IMF’s SDR allocation
- India’s current IMF quota: SDR 13,114 million = 2.76%
- India = IMF’s sixth largest quota holding member
- India has 132,603 votes = 2.63% voting share
SDR — Special Drawing Rights
- SDR created as supplementary international reserve asset in 1969
- Created in context of Bretton Woods fixed exchange rate system
- SDR is neither a currency nor a claim on IMF
- Rather, it is a potential claim on the freely usable currencies of IMF members
- Initially defined as equivalent to 0.888671 grams of fine gold (= one US dollar at the time)
- SDR basket currently: US Dollar, Euro, Chinese Renminbi, Japanese Yen, British Pound Sterling
- Chinese RMB joined the basket effective October 1, 2016 (decided in November 2015 review)
- SDR basket reviewed every five years (or earlier if warranted)
- Value determined daily based on market exchange rates
- Two criteria: Export criterion + Freely usable criterion
World Bank Group — Five Institutions
| Institution | Year | Focus | India’s Status |
|---|---|---|---|
| IBRD (International Bank for Reconstruction and Development) | 1944 | Middle-income and creditworthy low-income countries; loans, guarantees, risk management | Founder member |
| IDA (International Development Association) | 1960 | World’s poorest countries; interest-free loans (25-40 yr repayment, 5-10 yr grace period); grants | Founder member |
| IFC (International Finance Corporation) | — | World’s largest multilateral source of loan and equity financing for developing-world private-sector; IFC’s single-largest country exposure = India | Founder member |
| MIGA (Multilateral Investment Guarantee Agency) | — | Encourages FDI into developing countries; protects investors against non-commercial/political risk | NOT a founder member |
| ICSID (International Centre for Settlement of Investment Disputes) | 1966 | Mediates and resolves legal disputes between international investors and states | India is NOT a member (exception) |
IMF vs World Bank Group — Key Differences
| Parameter | IMF | World Bank Group |
|---|---|---|
| Structure | Single institution | Five institutions (IBRD, IDA, IFC, MIGA, ICSID) |
| Focus | Oversees international monetary system; exchange rate and monetary stability | Promotes economic development of world’s poorer countries |
| Lending type | Short- to medium-term credits; BoP bailout funds | Long-term financing of development projects and programmes |
| Private sector | — | Encourages private enterprises through IFC; has insurance (MIGA) and arbitration (ICSID) wings |
| Funding | Principally from quota subscriptions of member countries | IBRD/IFC borrow from international bond markets; IDA gets donations |
WTO — World Trade Organization
WTO Key Facts
- GATT signed by 23 nations on October 30, 1947 in Geneva; went into effect January 1, 1948
- India was founding member of GATT
- Eight GATT rounds from 1948-1994
- WTO formed on January 1, 1995
- WTO conceived during 8th GATT cycle (1986-1994) — Uruguay Round — started in Uruguay, finished in Geneva
- 164 members as of June 2022
- HQ: Geneva
- Top decision-making body: Ministerial Conference — meets roughly every two years
- WTO = “watchdog of international trade”
WTO — Six Functions
- (i) Administering WTO trade agreements
- (ii) Providing forum for trade negotiations
- (iii) Handling trade disputes
- (iv) Monitoring national trade policies
- (v) Technical assistance and training for developing countries
- (vi) Cooperation with other international organisations
- India member of WTO since January 1995
- India member of GATT since July 1948
- India at Doha 2001: Most outspoken proponent for developing world
- 12th Ministerial Conference (June 2022, Geneva): Historic agreements on fisheries subsidies, food insecurity, COVID-19 vaccines
Key Regional Economic Organisations
| Organisation | Founded | Members/HQ | Key Facts |
|---|---|---|---|
| EU (European Union) | 1993 (Maastricht Treaty) | 28 nations | Brussels | Nobel Peace Prize 2012; economic + political bloc |
| Eurozone | 1999 | 19 of 28 EU states | ECB: Frankfurt | Single currency (Euro); European Central Bank manages monetary policy |
| SAARC | 1985 | 8 members | HQ: Kathmandu | India, Maldives, Pakistan, Bangladesh, Sri Lanka, Bhutan, Nepal, Afghanistan; SAFTA from January 1, 2006 |
| ASEAN | — | 10 members | HQ: Jakarta | Indonesia, Philippines, Malaysia, Thailand, Singapore, Brunei, Vietnam, Laos, Cambodia, Myanmar |
| OPEC | September 1960 | Baghdad | 13 oil-exporting countries | HQ: Vienna | Founded by: Iran, Iraq, Kuwait, Saudi Arabia, Venezuela; Qatar left January 1, 2019 |
| G-7 | 1975 | Canada, France, Germany, Italy, Japan, UK, USA | Focus: Global economic challenges |
| G-20 | 1999 | 20 members (19 countries + EU) | 2/3 global population, 85% global GDP, 75%+ global trade |
| OECD | 1961 | ~36 members | HQ: Paris | Promote economic advancement and global commerce |
| NAFTA | 1994 | Canada, USA, Mexico | One of world’s largest trading blocs by GDP |
| APEC | 1989 | 21 members | Asia-Pacific region; balanced, inclusive, sustainable growth |
| RCEP | — | 10 ASEAN + 5 FTA partners | Australia, China, Japan, NZ, Republic of Korea; India is NOT a member |
| BIMSTEC | June 1997 (as BISTEC) | 7 members (5 South Asia + 2 SE Asia) | Bangladesh, Bhutan, India, Nepal, Sri Lanka, Myanmar, Thailand; Bay of Bengal region |
Section 5 — Exam Angle Points
All PYQ answers verbatim + high-frequency facts
✅ Must-Know Facts — Verified from PDF
- IMF formed: July 1944 | 45 countries met at Bretton Woods, NY | 29 countries signed initially
- IMF member nations: 190
- India became IMF member: December 27, 1945
- India is founding member of IMF: Yes
- Finance Minister is ex-officio Governor on IMF Board of Governors
- India’s IMF quota: SDR 13,114 million = 2.76% stake
- India’s rank: 6th largest quota holding member of IMF
- India’s voting share: 132,603 votes = 2.63%
- IMF assistance to India in 2008 crisis: US$4.5 billion from SDR allocation
- SDR created: 1969 | Supplementary international reserve asset
- SDR is NOT a currency and NOT a direct claim on IMF
- SDR basket five currencies: US Dollar, Euro, Chinese Renminbi, Japanese Yen, British Pound Sterling
- Canadian Dollar is NOT in SDR basket
- Chinese RMB joined SDR basket: October 1, 2016 (decided November 2015)
- World Bank is largest development bank in the world
- WBG five institutions: IBRD, IDA, IFC, MIGA, ICSID
- India is founder member of: IBRD, IDA, IFC
- India is NOT a founder member of: MIGA
- India is NOT a member of: ICSID (exception among WBG components)
- IDA established: 1960 | Loans over 25-40 years, grace period 5-10 years
- ICSID founded: 1966 | Mediate legal disputes between investors and states
- IFC single-largest country exposure: India
- WB started assisting India: 1948 (Agricultural Machinery Project)
- WB resident mission in India: Established 1957
- GATT signed: October 30, 1947, Geneva by 23 nations | Effective January 1, 1948
- India founding member of GATT: Yes; India member of GATT since July 1948
- WTO formed: January 1, 1995
- WTO members: 164 (as of June 2022)
- WTO HQ: Geneva
- WTO Uruguay Round: 8th GATT cycle (1986-1994) — started Uruguay, finished Geneva
- India member of WTO since: January 1995
- OPEC founded: September 1960, Baghdad
- OPEC founding members: Iran, Iraq, Kuwait, Saudi Arabia, Venezuela
- Qatar left OPEC: January 1, 2019
- OPEC HQ: Vienna
- SAARC founded: 1985 | HQ: Kathmandu | 8 members
- India is NOT a member of RCEP
- G-20 formed: 1999 | 85% global GDP, 75%+ global trade, 2/3 global population
📝 Actual PYQ Answers from PDF
Q1: When did India become a member of IMF?
(a) 1945 (b) 1995 (c) 2000 (d) 2010
(a) 1945 (b) 1995 (c) 2000 (d) 2010
Answer: (a) 1945 (December 27, 1945)
Q2: Which is NOT one of the five currencies used for SDR valuation?
(a) US Dollar (b) Canadian Dollar (c) Japanese Yen (d) Chinese Renminbi
(a) US Dollar (b) Canadian Dollar (c) Japanese Yen (d) Chinese Renminbi
Answer: (b) Canadian Dollar. The five are: US Dollar, Euro, Chinese Renminbi, Japanese Yen, British Pound Sterling.
Q3: India is NOT one of the founder members of which WBG institution?
(a) IBRD (b) IDA (c) MIGA (d) IFC
(a) IBRD (b) IDA (c) MIGA (d) IFC
Answer: (c) MIGA. India is founder member of IBRD, IDA and IFC. India is also NOT a member of ICSID.
Q4: Which nation is NOT a member of OPEC?
(a) Kuwait (b) Saudi Arabia (c) UAE (d) Qatar
(a) Kuwait (b) Saudi Arabia (c) UAE (d) Qatar
Answer: (d) Qatar — Qatar terminated its membership on January 1, 2019.
Q5: Is India a member of RCEP?
(a) No (b) Yes
(a) No (b) Yes
Answer: (a) No — India is NOT a member of RCEP.
Section 6 — Memory Tricks
Never mix up IMF vs WB, SDR basket, OPEC founding members
Trick 1 — IMF vs World Bank
IMF = monetary stability | WB = poverty and development
“IMF is the Money Doctor. World Bank is the Development Builder!”
IMF fixes monetary crises — like a doctor treating acute illness (BoP problems, exchange rate issues). World Bank builds long-term — like a builder constructing schools, roads, hospitals for poor countries. IMF = single institution, World Bank = five institutions (IBRD, IDA, IFC, MIGA, ICSID). IMF funds from quotas. IBRD/IFC borrow from bond markets. IDA gets donations.
Trick 2 — WBG India Membership
Founder: IBRD, IDA, IFC | NOT founder: MIGA | NOT member: ICSID
“India is IN 3 (IBRD, IDA, IFC), not in MIGA-founding, absent from ICSID!”
India = founder of the 3 original WBG members: IBRD + IDA + IFC. MIGA and ICSID came later — India is NOT a founder of MIGA and is NOT a member of ICSID at all. Exam asks: “India is NOT founder of which?” = MIGA. “India is NOT member of which?” = ICSID. Remember: ICSID is for investment disputes — India chose not to join it.
Trick 3 — SDR Five Currencies
US$, Euro, Chinese RMB, Japanese Yen, British £
“5 global powers — USA, Europe, China, Japan, Britain!”
SDR basket = 5 currencies: USD (USA) + Euro (Europe) + Renminbi/RMB (China) + Yen (Japan) + Pound (Britain). The most common trick: “Canadian Dollar is NOT in SDR basket.” China’s RMB joined October 1, 2016 (reviewed in November 2015). SDR basket reviewed every 5 years. SDR is NOT a currency — it’s a potential claim on freely usable currencies.
Trick 4 — OPEC + Qatar exit
OPEC founding 1960 | Qatar left 2019
“OPEC was born in Baghdad in 1960 by 5 oil nations. Qatar quit in 2019!”
OPEC founded: September 1960 in Baghdad. Five founding members: Iran, Iraq, Kuwait, Saudi Arabia, Venezuela. HQ: Vienna. Qatar left on January 1, 2019. UAE is a member but Qatar is NOT (after 2019). The exam trick: “Which is NOT an OPEC member?” — Qatar (left) or any non-oil country. 13 current members after Qatar’s exit.
Section 7 — Flash Cards
10-minute revision before your JAIIB exam
IMF Formation
July 1944, Bretton Woods, NY
45 countries met | 29 signed | India joined December 27, 1945
India IMF Rank
6th largest quota holder
SDR 13,114 mn = 2.76% quota | 132,603 votes = 2.63% voting share
SDR Created
1969 | NOT a currency
Potential claim on freely usable currencies | Basket: USD, Euro, RMB, Yen, £
Chinese RMB Joined SDR
October 1, 2016
Decided November 2015 review | 5th currency in basket
WBG Five Institutions
IBRD + IDA + IFC + MIGA + ICSID
India: founder of IBRD, IDA, IFC | NOT member of ICSID
IDA Established
1960 | World’s poorest countries
Interest-free loans | 25-40 yr repayment | 5-10 yr grace period
ICSID Founded
1966 | Investment dispute settlement
India is NOT a member of ICSID (exception in WBG)
WTO Formed
January 1, 1995 | HQ: Geneva
164 members (June 2022) | Successor to GATT | Uruguay Round
GATT Signed
October 30, 1947 | 23 nations
Effective January 1, 1948 | India founding member of GATT (July 1948)
OPEC Founded
September 1960, Baghdad
5 founders: Iran, Iraq, Kuwait, Saudi Arabia, Venezuela | HQ: Vienna | Qatar left Jan 1, 2019
SAARC
1985 | HQ: Kathmandu | 8 members
SAFTA from January 1, 2006
India and RCEP
India is NOT a member
RCEP = 10 ASEAN + Australia, China, Japan, NZ, Republic of Korea
⚡ Chapter 9 Complete — International Economic Organisations
- Three main international economic organisations: IMF (monetary), World Bank Group (development), WTO (trade)
- IMF: Formed July 1944, Bretton Woods | 190 members | India joined December 27, 1945 (founding member)
- Finance Minister = ex-officio IMF Governor | India = 6th largest quota holder (SDR 13,114 mn = 2.76%)
- SDR created 1969 | NOT a currency | Basket: USD + Euro + RMB + Yen + £ | Chinese RMB added Oct 1, 2016
- WBG = five institutions: IBRD + IDA + IFC + MIGA + ICSID | HQ Washington D.C.
- India = founder of IBRD, IDA, IFC | NOT founder of MIGA | NOT a member of ICSID
- IFC’s single-largest country exposure = India | IDA = 1960, interest-free loans, 25-40 yr repayment
- ICSID = 1966, mediates investor-state disputes | World Bank = largest development bank in the world
- IMF: single institution, quota funding, short-medium term | WBG: 5 institutions, bond market funding, long-term
- GATT signed Oct 30, 1947 (23 nations) | Effective Jan 1, 1948 | India founding GATT member (July 1948)
- WTO formed Jan 1, 1995 | Uruguay Round (1986-94) | 164 members | HQ Geneva | India member Jan 1995
- OPEC: Sept 1960, Baghdad | 5 founders (Iran, Iraq, Kuwait, Saudi Arabia, Venezuela) | HQ Vienna | Qatar left Jan 1, 2019
- SAARC: 1985, Kathmandu, 8 members | SAFTA: Jan 1, 2006 | India NOT member of RCEP
- G-20: 1999 | 85% global GDP, 75%+ trade, 2/3 population | OECD: 1961, Paris, ~36 members
Banky says: “Now I can explain exactly how IMF, World Bank and WTO are different!” 🎉
You know all 5 WBG institutions, India’s status in each, SDR basket currencies, IMF quota/voting share, WTO history, OPEC founding and Qatar’s exit — plus all 5 PYQ answers. Global institutions mastered! 💪