Eminent banker K V Kamath will be the first president of USD 100 billion BRICS Bank which will provide infrastructure loans to emerging nations, rivalling multilateral lenders such as World Bank and IMF.
Kamath, 67, will have a five year term at the bank, which is likely to be operationalised within one year as ‘New Development Bank’ being set up by the five nation grouping, BRICS, Finance Secretary Rajiv Mehrishi said.
“The appointment will be effective when he becomes free from his current assignment. I think he is on some boards. It may take couple of days,” he said.
Kamath is the non-executive Chairman of the India’s largest private sector bank ICICI. Besides, he is also the non-executive chairperson of the IT bellwether Infosys.
“There is no final decision on his tenure. But it is likely to be 5 years. We got ratification from President of India,” he said, adding it has to be ratified by all the member nation.
Leaders of the emerging economies of Brazil, Russia, India, China and South Africa (BRICS) had last year reached an agreement to establish the New Development Bank, with its headquarters in Shanghai. As per the agreement, India got the right to nominate the first president.
The BRICS nations account for nearly USD 16 trillion in GDP and 40 per cent of the world’s population.
India is hoping to get more funds for infrastructure development from BRICS bank, he said.
The bank will start with an initial paid-in-capital of USD 50 billion with each BRICS country contributing USD 10 billion, while its authorised capital is USD 100 billion.
Equal capital contribution has been decided so that the development bank does not fall into the ownership pattern of IMF and the World Bank, with a distorted shareholding.