India is focusing on offshore rupee bonds to finance its long-term infrastructure projects rather than green bonds, Xian Zhu, Vice President & Chief Operations Officer, New Development Bank (NDB), said.
Mr. Zhu added that the NDB, commonly referred to as the BRICS Bank, was actively trying to be different from the established regional and global banks like the Asian Development Bank and the World Bank and was open to widening its membership to non-BRICS countries as well.
“The signal we got from India is that they want to focus first on offshore rupee bond market,” Mr. Zhu said in the context of China’s recent three billion yuan green bond issuance. “The idea is to issue bonds in each country’s local currency to finance long-term infrastructure projects,” Mr. Zhu said. He was speaking at the BRICS Business Forum in New Delhi.
The vision and mission of the NDB would ensure the lender would be distinct and different from banks like the World Bank and the Asian Development Bank, Mr. Zhu said.
“We want to work with the private sector so we can leverage that capital, and we also want to be mindful of bureaucratic trap of inefficiency that can often comes with state-run organisations,” he said. “We are brining a new philosophy, new approach, and new corporate culture.” Elaborating on the NDB’s engagement with the private sector, Mr. Zhu said that the Bank was looking at initiating discussions with the private sector to develop the PPP model at the global level for projects.
Mr. Zhu also said that it was inaccurate to refer to the NDB as the ‘BRICS Bank’ since it was open to eventually expanding its membership.
“The NDB is open to finance non-BRICS member countries as well which are members in the United Nations,” Mr. Zhu said. “NDB is ready to welcome non-BRICS emerging economies to avail long term financing. The bank wants to play a constructive role in developing economies.”
