India is a founding member of AIIB, and Modi govt has every right to borrow money from it

What do political opportunists in the opposition ranks do, when they can’t fault the government? They start grabbing attention with one-liners or so-called ‘witty’ jibes. So, the latest piece of senseless propaganda being passed around is that the Modi government took a loan from a ‘China-sponsored’ Bank- the Asia Infrastructure Investment Bank (AIIB).

Of course, accuracy is being compromised for the sake of sensationalism here. None of the enraged critics seems to care about how AIIB isn’t a Chinese Bank or a Chinese development agency. In fact, it is a multilateral institution with 103 countries and India itself is the second-largest shareholder in this multilateral body.

It all started with The Telegraph report, titled, “China loan horse without a mouth,” which stated that India borrowed a sum of $750 million from the AIIB. The Telegraph further reported, “Narendra Modi government has formally confirmed that India took two loans totalling $1,350 million (Rs 9,202 crore) from the China-controlled Bank in the thick of the border standoff.”

The Telegraph then tried to take a dig at the Modi government by claiming, “Action of delinking the government’s financial transactions from bilateral tensions goes against the Centre’s policy of cracking down on Chinese business relationships in India. Besides, the Indian external affairs ministry has been asserting that it cannot be business as usual in the face of Chinese attempts to unilaterally change the facts on the ground along the border.”

Soon the entire left-liberal ecosystem was up in arms. INC legislators, journalists and the rest of the leftist political spectrum came together to ask- Why the Modi government took loan from the AIIB? To somehow create a narrative, the AIIB is now being described as a ‘Beijing-based Bank’, ‘China-sponsored Bank’ and INC leader Randeep Singh Surjewala even called it a ‘Chinese government Bank’. And let’s not even talk about what Rahul Gandhi, the perpetual Prime Minister-in-waiting had to say about the AIIB loan.

Now, we at TFIPOST also have a question. We want to ask the distinguished economists of the leftist ecosystem- why should India not borrow from the AIIB? China may be the largest shareholder but India is also the second-largest shareholder in this multilateral development Bank.

Let us check some numbers- China does have a 26 per cent stake in the multilateral bank, but the rest of the stake is owned by more than 100 countries. India itself has an 8.7% share in AIIB, being the second-largest investor with a mammoth 8.4 billion Dollars stake. Also, India is a founding member of the Asia Infrastructure Investment Bank.

Now that India has played its role in giving birth to this Development Bank, why shouldn’t it avail cheaper loans from the AIIB for fuelling its own development? India has a deep and inalienable interest in the AIIB and India’s Union Finance Minister also sits on the Bank’s Board of Directors.

https://twitter.com/SandeepParekh/status/1306157135735263232?s=20

So, if we may do a little fact-check, the AIIB is neither a Chinese agency nor a China-controlled bank. And it is certainly not a China-sponsored bank. AIIB is just another infrastructure development Bank, and it isn’t very different from the World Bank or the Asia Development Bank.

By borrowing from a multilateral institution, India didn’t really borrow Chinese money. And what is the deal with the AIIB’s Beijing headquarters? How does that make the multilateral Bank Chinese, especially when as many as 103 countries are members of this multilateral body?

Even the World Bank is headquartered in Washington, does that make it an American institution? For decades, India and China have borrowed heavily from the World Bank. China still borrows indiscriminately from the World Bank though it doesn’t really need such soft loans. The US still has a 17.25 per cent stake in the World Bank, yet China hasn’t stopped borrowing from the multilateral body.

Beijing still benefits out of the World Bank notwithstanding China’s endless disputes with the democratic world. So, why should India stop borrowing from the AIIB to fuel its own development?

Just because a few Sinophiles think that the AIIB is a Chinese bank, Beijing doesn’t gain ownership of the AIIB. New Delhi has every right to develop its infrastructure by availing soft loans from the AIIB. And in doing so the Modi government is neither buying Chinese money nor is it legitimising China.