GS Paper - 2 (International Relations)

The World Bank suspended funding for dozens of projects in Afghanistan, citing questions over the legitimacy of Taliban rule. The Washington-based institution has committed around $5.3 billion for reconstruction and development projects in Afghanistan since 2002 through its International Development Association that helps the world’s poorest countries.

What

  1. As of April, the development association had 12 active projects totaling $940 million in commitments, the bank said in its latest update earlier this year.
  2. Separately, its Afghanistan Reconstruction Trust Fund had 15 projects with $1.2 billion committed, it said in its April update.
  3. Under its policies, the World Bank said it cannot disburse funds when there is no agreement by its 189 member countries on whether a country has a legitimate government.
  4. Most of the World Bank’s support in Afghanistan—about $4.8 billion—has come in the form of grants, while $436 million has been in the form of no-interest loans.
  5. To help rebuild the country, the World Bank also created and administered the Afghanistan Reconstruction Trust Fund, which has been supported by funding from 34 donor countries.
  6. The money has been allocated to a variety of projects, including improving urban water systems, building vocational schools and responding to the Covid-19 pandemic.
  7. The International Monetary Fund, which like the World Bank is based in Washington and collectively owned by member governments, said earlier that Afghanistan would be ineligible for IMF loans until a government is recognized.