6 min readNew DelhiFeb 24, 2023 12:18 PM IST
First published on: Feb 24, 2023 at 11:10 AM IST
Indian-American business executive Ajay Banga was Thursday nominated by US President Joe Biden to head the World Bank. If confirmed by the World Bank board of directors, Banga, 63, will be the first Indian-American to head either of the two top international financial institutions: the International Monetary Fund and the World Bank.
US banker David Malpass was the previous president of the World Bank Group before he stepped down just over a week ago. Malpass will leave on June 30, around a year before his five-year term is to end. He was picked in 2019 by then US president Donald Trump.
Banga’s confirmation will be subject to a vote from World Bank executive directors. As the biggest shareholder, the US’s nomination usually ends up being selected. The president of the World Bank is ex officio chair of the Board of executive directors of the International Bank for Reconstruction and Development (IBRD) or the World Bank and the International Development Association (IDA).
They also chair other UN bodies like the Board of Directors of the International Finance Corporation (IFC), the Multilateral Investment Guarantee Agency (MIGA), and the Administrative Council of the International Centre for Settlement of Investment Disputes (ICSID).
Who is Ajay Banga?
Banga was raised in India. After finishing school at Hyderabad Public School, he earned a Bachelor’s degree in Economics from the University of Delhi’s St. Stephen’s College, and later did an MBA degree from the Indian Institute for Management, Ahmedabad.
Starting his career with Nestle in 1981, he went on to join Pepsico and then Citigroup. He was also the president and CEO of Mastercard, the financial services company. When Banga met Prime Minister Narendra Modi in New York in 2014, just after the latter was elected, the two discussed India’s prospects in the US business community.
In 2016, Banga was awarded the Padma Shri by the President of India.
In this picture taken in 2014, Prime Minister Narendra Modi shakes hands with Ajay Banga after a breakfast meeting with American CEOs in New York. (PTI Photo)
Banga currently serves as Vice Chairman at General Atlantic, a private equity company. His profile on the website states: “Over the course of his career, he has served as an advisor to governments, companies and organisations of all kinds.”
According to the White House’s briefing, Banga is an Honorary Chairman of the International Chamber of Commerce and has been on the Boards of the American Red Cross, Kraft Foods and Dow Inc. “Ajay has worked closely with Vice President Harris as the Co-Chair of the Partnership for Central America,” it states, adding he was a founding trustee of the US-India Strategic Partnership Forum, a former member of the National Committee on United States-China Relations, and Chairman Emeritus of the American India Foundation.
Banga was also a member of President Obama’s Commission on Enhancing National Cybersecurity.
In a statement from Biden, meanwhile, he was described as being “uniquely equipped to lead the World Bank at this critical moment in history”. The statement added, “Raised in India, Ajay has a unique perspective on the opportunities and challenges facing developing countries and how the World Bank can deliver on its ambitious agenda to reduce poverty and expand prosperity.”
In a separate statement, US Treasury Secretary Janet Yellen said of Banga, “His efforts have helped bring 500 million unbanked people into the digital economy.” Over the years, he has often emphasised on financial inclusion of the poor through digital means.
In a lecture he delivered to students in 2014 at NYU Stern, a business college, he quipped he enjoyed his time at IIM-A “perhaps a little too much!” He praised the faculty and recalled having met his wife there.
Stressing the need for diversity in business, he said at the lecture, “To state the obvious, I tend to stand out in a room – turbans and beards will do that to you. My part-time hobby is being ‘randomly’ searched at airports! And I run a global company. That’s not exactly common for someone who looks like me… But I realised very early in my career that if I wasn’t comfortable with myself, then I couldn’t succeed. It’s critical that you figure out who you are and be comfortable with it.”
I realised very early in my career that if I wasn’t comfortable with myself, then I couldn’t succeed. It’s critical that you figure out who you are and be comfortable with it
Ajay BangaNominated to head World BankBiden’s statement emphasised Banga’s “critical experience mobilising public-private resources to tackle the most urgent challenges of our time, including climate change.”
Rachel Kyte, a former World Bank vice president and climate change envoy, told The New York Times that while Banga did not have a deep history of working on climate and fiscal policy, he had strong management skills and a genuine concern about climate change.
Notably, the former President of the World Bank, David Malpass, resigned after uproar over his ambiguous views on the science proving climate change. He has said he is not a climate denier, or someone who refused to accept the fact that climate change has been accelerated due to human activities.
But when asked about the contribution of fossil fuels in adding to climate change in September 2022, Malpass said, “I’m not a scientist”, leading to a backlash. As per a report in The New York Times, the World Bank is the largest global provider of financing for climate projects, spending some $68 billion on such efforts over the past five years, based on Organization for Economic Cooperation and Development data.
President and CEO of Mastercard Ajay Banga leaves after meeting Prime Minister Narendra Modi at a breakfast in the Manhattan borough of New York, September 29, 2014. (Photo via Reuters) 
In this picture taken in 2014, Prime Minister Narendra Modi shakes hands with Ajay Banga after a breakfast meeting with American CEOs in New York. (PTI Photo)
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