France, Germany, Italy decides to join China-backed AIIB
Three nations from European Union (EU) France, Germany and Italy have agreed to join the China-backed Asian Infrastructure Investment Bank (AIIB) after the United Kingdom (UK) decided to join the bank.
If these western nations join the bank, the total number of the bank’s member states including India will go up to 30.
It should be noted that UK was the first Western country to join the bank and also first nation to disregard the reservations expressed by the United States (US) which had raised concerns over banks transparency.
About Asian Infrastructure Investment Bank (AIIB)
- AIIB is an international financial institution proposed by China which seeks to provide support to infrastructure projects in Asia.
- It is expected to be operational by the end 2015 and its headquarters will be located at Beijing.
- The bank is also considered as China’s move to balance the power with the WB, IMF and ADB which are being controlled/dominated by the US, EU and Japan respectively.
- The authorised capital of AIIB is US $100 bn and the initial subscribed capital is expected to be around US $50 bn. The paid-in ratio will be 20%.
- India along with other 20 member nations were founding member of AIIB and had signed agreement in this regard in October 2014.