The New Development Bank (NDB) is a multilateral development bank, an international financial institution established by the BRICS nations: Brazil, Russia, India, China, and South Africa. The idea was proposed by India at the 4th BRICS summit in 2012. The agreement to establish the NDB was signed on July 15, 2014, at the 6th BRICS summit in Fortaleza, Brazil, and the bank became fully operational in July 2015.
The NDB was created to mobilize resources for infrastructure and sustainable development projects in BRICS and other emerging and developing economies, addressing the financial gap for such development in the Global South. It was also intended to simplify mutual settlement and lending operations among BRICS nations, reducing dependence on the US dollar and the Euro.
The bank works by supporting public or private projects through loans, guarantees, equity participation, and other financial instruments. Its initial authorized capital was US$100 billion, with the five founding members each holding an equal stake and contributing an equal share to the bank's assets. The NDB's Articles of Agreement specify that all members of the United Nations can join, but the original BRICS group must retain at least 55% of the total voting power. Article 1 of the founding agreement mandates the bank to complement the efforts of existing multilateral and regional financial institutions.
The NDB is closely connected to the BRICS intergovernmental organization and is often compared to established institutions like the World Bank and the Asian Development Bank (ADB). A related concept is the Contingent Reserve Arrangement (CRA), also established by BRICS in 2014, which provides a liquidity instrument for short-term balance of payments pressures.
The NDB has recently expanded its membership beyond the founding five, with the admission of countries like Bangladesh, the United Arab Emirates, and Egypt in 2021 and 2022. In 2022, the NDB established an India Regional Office in Gujarat International Finance Tec-City (GIFT City). The bank's General Strategy for 2022–2026 focuses on its evolution into a leading provider of solutions for infrastructure and sustainable development.