A viral claim on social media asserts that the Prime Minister Modi-led government has cleared all of India’s debt with the World Bank in the last six years.
For 70 years India was the biggest borrower at the world Bank, Once every Indian born was a debtor at birth, the things…
The complete message says, “For 70 years India was the biggest borrower at the world Bank, Once every Indian born was a debtor at birth, the things which great economists couldn’t do, a chaiwala did it, he changed India’s and Indian’s fate, within 6 years @narendramodi has cleared every penny of India’s debt at the world Bank, all paid. Full settlement done at UN by India, who is that fellow who was talking about some economic slowdown in india? #UNLoanCleared #ModiHaiToMumkinHai.”
The claim has been propagated using a screenshot of a tweet by India’s permanent representative at the United Nations, Syed Akbaruddin.
For 70 years India was the biggest borrower at the world Bank, once every Indian born was a debtor, the things which great economists couldn’t do, a chaiwala did it, he changed India’s & Indian’s fate, @narendramodi did it in just 6 years as PM #UNLoanCleared #ModiHaiToMumkinHai pic.twitter.com/ZYGZ6VBasS
— Manojava Gururaj Galgali (@ManojavG) October 11, 2019
A screenshot of Akbaruddin’s tweet is also circulating on WhatsApp. Alt News has received several verification requests of the same on its official mobile application.
Social media claims are incorrect on various counts and we will go through each of them separately in this report.
1. Akbaruddin’s tweet is about payment of dues to the United Nations, not loans taken from the World Bank
Here’s what Syed Akbaruddin’s October 11 tweet reads in its entirety – “All Paid. Only 35 states of 193 have paid all dues to the @UN as of today.”
— Syed Akbaruddin (@AkbaruddinIndia) October 11, 2019
This itself clarifies that Akbaruddin was talking about the fulfilment of dues to the United Nations, not loans repaid to the World Bank.
A report on the ‘Financial situation of the United Nations’ published on October 11, 2019, carries a chart (also tweeted by Akbaruddin) which lists the countries that have paid all assessment dues to the international body as of 11 October 2019.
UN releases this report bi-annually. The previous report, released in May 2019, also reflects that India had paid all assessment dues.
2. Dues paid to the United Nations are not repayment of loans
It’s noteworthy that dues paid to the United Nations are not repayment of loans. These are mandatory payments made by each of its 193 member states to fund the international body. Member states can also make voluntary contributions over and above the mandatory payments. Article 17 of the UN charter says, “The expenses of the Organization shall be borne by the Members as apportioned by the General Assembly.”
Syed Akbaruddin’s statement that the country has paid all her dues meant that India has made payment in full toward the United Nation’s regular annual budget, peacekeeping assessment and tribunal assessment.
The world body runs into a deficit if the member states do not make timely contributions. Secretary-General Antonio Guterres had recently stated, “Member States have paid only 70 per cent of the total amount needed for our regular budget operations in 2019. This translates into a cash shortage of $230 million at the end of September. We run the risk of depleting our backup liquidity reserves by the end of the month [October].”
3. India has not repaid all its loans to the World Bank
According to the World Bank data, the lending body has committed $3277 million or $3.2 billion to India in 2019. This includes commitments made by the International Bank for Reconstruction and Development (IBRD) and IDA (International Development Association) which are a part of the World Bank.
The graph below shows amounts committed by the financial institution since 2015.
It is being claimed on social media that India has repaid all her loans in the last six years. However, the country owes IDA, which helps the world’s poorest countries, more than $1.1 billion for 21 projects undertaken between 2014 to date.
Furthermore, India owes IBRD over $2.3 billion for 11 projects, of which nine were agreed upon during UPA government.
A list of all the projects approved by the World Bank between May 26, 2014 (when PM Modi took office) to date can be accessed here. Out of these 88 projects, a majority have been completed and the rest are either active, dropped or in the pipeline.
The latest project approved by the international lender was the ‘Odisha Integrated Irrigation Project for Climate Resilient Agriculture‘ on September 30, 2019. The total project costs $235.50 million, of which IBRD has committed $165 million. It is noteworthy that the project has only been approved by the World Bank Board and an agreement is yet to be signed.
India has therefore not repaid all her loans to the World Bank. In fact, a report published by the organisation in 2016 showed that India is the largest recipient of loans among all nations since its independence. These include loans taken during Narendra Modi’s first term as Prime Minister. As a growing nation with pressing infrastructural needs, India continues to rely on the World Bank for funding various developmental projects focusing mainly on transport, healthcare, education, energy, among others. Several of these loans are unpaid because of a repayment schedule and outstanding amounts that are due. For instance, the ‘India: Enhancing Teacher Effectiveness in Bihar‘ project was signed in 2015. The project is scheduled to be completed on June 30, 2020. But the date of payment of the final instalment is May 15, 2040.
It may be reiterated that the screenshot shared by Syed Akbaruddin did not speak about repayment of loans to the World Bank but payment of dues to the United Nations as a member state.