ECAS Agenda : Know the difference between IMF and World Bank - Every Corner A Story

ECAS Agenda : Know the difference between IMF and World Bank

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The main differences between the World Bank (WB) and the International Monetary Fund (IMF) are:

1. Objective/Orientation (Internal Economy vs. External Balance):

The World Bank (WB) lends for undertaking development programmes - resources for building infrastructure, setting up facilities, etc. On the other hand, International Monetary Fund (IMF) gives 'assistance' funds so that External economic crises can be warded off, and other nations' debts (External debts) could be paid off. Essentially, WB has the orientation towards addressing resource need for the progress of Internal economy (Growth - Reduction of poverty) and IMF is aimed towards maintaining External Balance (Stability) of Members.

2. Nature of Operations (Lending vs. Assistance):

The World Bank is a lending institution. IMF is not - It is a watchdog agency keeping tabs on External (exchange rate, Balance of Payment (BoP) operations) and Internal (Monetary) policies and debt-related economic health of member countries. 

3. Structure of Institution (Bank vs. Fund):

WB is structured as a Bank - an intermediary between Investor countries and Borrowing countries. It has 188 members now. On the other hand, IMF is a Fund pool - like a Co-operative Credit Society, where needy members get to borrow from it only upon acceding to terms and conditions for monetary-fiscal reforms and policy prudence. IMF too has 188 member countries.

4. Organizational Chart (Unitary vs. Multi-lateral):

IMF is a one-man army, it's a single Fund having 4 types of credit lines i.e. different types of loans with different tranches, conditions, and strings. 


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