Development
policy financing
Prelims:
Economy, International Organizations
Mains:
GS Paper II – Governance, International Relations, GS Paper III –
Indian Economy,
Current
relevance:
The World Bank approved a
$1.5 billion Development Policy Financing (DPF) for India to
support structural reforms for private sector-led job creation and sustainable
economic growth.
About
Development Policy Financing (DPF):
1.
It is a World
Bank financing instrument that supports countries through budget assistance
linked to policy and institutional reforms.
2.
It focuses on supporting government-led policy and
institutional reforms rather than financing individual infrastructure projects.
3.
It supports
policy reforms and sustainable development by linking financial assistance to macroeconomic policies, institutional
reforms, poverty reduction, environmental sustainability.
4.
Funds are made available to the nations based on:
(i)
Maintenance of an adequate macroeconomic policy framework, as assessed by the Bank
based on IMF evaluations.
(ii)
Satisfactory progress in implementing the broader reform agenda
(iii) Fulfillment of key policy
and institutional actions mutually agreed upon by the Bank and the client
(iv) Alignment with the Goals
of the Paris Agreement, as determined by the Bank.
Source: THE HINDU