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Amardip Sanan asked: Is India thinking about creating a common IBSA bank, similar to the BRICS bank?

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  • Jagannath P. Panda replies: Strategic communities in India, Brazil and South Africa have started debating and discussing the possibility of creating a common bank for IBSA grouping. The idea is at a preliminary level and far from being actualised. Establishing a common IBSA Bank will not only require common understanding, but also proper political direction and consultation among the member countries. The launch of BRICS Development Bank is certainly a reference point in this context.

    Given India’s economic and political weight, New Delhi must take a leading approach towards the creation of a common IBSA bank. However, it will not be easy to push this idea ahead given that the formation of a common bank will require stable funding resources, institutional mechanisms and trans-national cooperation among member countries. Besides, the BRICS Development Bank is still in an evolving stage and all the IBSA countries are members of BRICS. Both Brazil and South Africa may also find it difficult to contribute financially to IBSA bank since they have already agreed to contribute to the BRICS Development Bank.