Previous Year Question
Consider the following statements:
New Development Bank has been set up by APEC.
The headquarters of the New Development Bank is in Shanghai.
Which of the statements given above is/are correct?
1 only
2 only
Both 1 and 2
Neither 1 nor 2
Correct Answer: B
Detailed Solution
Statement 1 is incorrect. The New Development Bank—NDB was established not by APEC but by the five original BRICS countries—Brazil, Russia, India, China and South Africa.
Important stages in the establishment of the NDB were:
The possibility of creating a new development bank was considered at the 2012 BRICS Summit in New Delhi.
At the 2013 Durban Summit, BRICS countries agreed to establish the bank.
The Agreement on the New Development Bank was signed on 15 July 2014 at the sixth BRICS Summit in Fortaleza, Brazil.
The agreement entered into force on 3 July 2015.
The bank formally commenced operations in July 2015.
Therefore, the statement that NDB was established by APEC is incorrect. APEC, or Asia-Pacific Economic Cooperation, is an economic-cooperation forum for the Asia-Pacific region and did not establish the NDB.
Statement 2 is correct. The headquarters of the NDB is located in Shanghai, China. This location was specified in the founding agreement of the bank.
The principal purpose of the NDB is to mobilise resources for infrastructure and sustainable-development projects in BRICS and other emerging markets and developing countries, including:
Transport, energy, water and urban infrastructure.
Clean-energy and environmental projects.
Digital and social infrastructure.
Projects contributing to sustainable development.
The bank can support public or private projects through loans, guarantees, equity participation and other financial instruments.
The financial structure originally provided for:
Authorised capital of US$100 billion.
Initial subscribed capital of US$50 billion.
Equal initial shareholding among the five founding countries.
Current position (2026)
The NDB headquarters remains in Shanghai. To expand its geographical operations, it has established the Africa Regional Centre in Johannesburg, the Americas Regional Office in São Paulo and the Indian Regional Office in GIFT City, Gujarat. Its membership has also expanded beyond the five original BRICS members.