Write A Comprehensive Note On The International Development Association (IDA)?

International Development Association was set up in 1960. The requirements of capital were increasing in the developing countries and it became difficult for the IBRD to perform its statutory duties. Keeping in view the problems, USA presented the resolution for IDA to co-ordinate with IBRD in the annual meeting of IMF in 1959. So in 1960 Article of arrangement for IDA was submitted to the member countries in January, 1960. And it is started functioning.

IBRD members may be the members of IDA. There are two Categories of members. First category includes industrialized nations, Kuwait and UAE. Second category includes poor and developing countries.

IDA objectives are same as IBRD. Its aid is for the development of poorest countries. Its conditions are more liberal. Its aid is for productive purposes and it stimulates economic growth. IDA loans are called credits. It provides long term credit to poor countries at soft terms. It creates supplementary source of capital for member countries. It increases the productivity and promotes economic growth of member developing countries. IDA has its own financial resources but it is closely connected with the World Bank. Executive Directors of IBRD and IDA are same.