The leaders of the group of five BRICS (Brazil, Russia, India, China and South Africa) emerging market countries signed on Tuesday a deal to create a new development bank and anemergency reserve fund, Brazil's President Dilma Rousseffannounced at a summit of the group here.
"The agreement towards setting up the BRICS New Development Bank is a significant step. I am happy the initiative announced in 2012 in Delhi has become a reality," Prime Minister Narendra Modi said.
The new bank will be headquartered in Shanghai, China. The first president of the bank will be from India while the first chair of the board of governors will be from Russia.
Sources said India's demand for an equal share in the bank has also been accepted.
The deal was reached after intense last-minute negotiations to settle a dispute between India and China over the headquarters of the new bank, which will have initial capital of $100 billion to invest in infrastructure projects.
The impasse reflected the difficulties that BRICS nations face in working together to build an alternative to Western-run multilateral institutions that have shaped world finances since the end of World War-II.
Failure to agree on the headquarters would have been an embarrassment for the BRICS, a group better known for its anti-Western rhetoric than agreement on concrete actions to reshape the world's financial architecture.
An official, who declined to be named, said leaders changed their positions late on Tuesday night and agreed to sign the deal.
"The agreement towards setting up the BRICS New Development Bank is a significant step. I am happy the initiative announced in 2012 in Delhi has become a reality," Prime Minister Narendra Modi said.
The new bank will be headquartered in Shanghai, China. The first president of the bank will be from India while the first chair of the board of governors will be from Russia.
Sources said India's demand for an equal share in the bank has also been accepted.
The deal was reached after intense last-minute negotiations to settle a dispute between India and China over the headquarters of the new bank, which will have initial capital of $100 billion to invest in infrastructure projects.
The impasse reflected the difficulties that BRICS nations face in working together to build an alternative to Western-run multilateral institutions that have shaped world finances since the end of World War-II.
Failure to agree on the headquarters would have been an embarrassment for the BRICS, a group better known for its anti-Western rhetoric than agreement on concrete actions to reshape the world's financial architecture.
An official, who declined to be named, said leaders changed their positions late on Tuesday night and agreed to sign the deal.
Was hoping for the HQ to be in India, disappointed with that bit. Anyway I am not sure if this bank can make any significant impact until India and China can resolve their border disputes, if there is not much co-operation between the two heavyweights this will be just another failure IMHO.
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