Finance Minister Nirmala Sitharaman on Thursday called on the World Bank to step up private capital mobilisation, make financing more affordable for developing economies and review its governance indicators, saying development efforts must ultimately translate into jobs and higher productivity.
Speaking at the 114th meeting of the World Bank's Development Committee Plenary in Bangkok, Thailand, Sitharaman said productive and better-paid jobs remained the most effective route to poverty reduction and shared prosperity amid energy market stress, trade fragmentation, climate pressures and rapid technological change.
“We welcome the continued focus on mobilising private capital and creating jobs,” she said, adding that sustainable employment required an ecosystem that supported inclusive economic growth.
Private investment must translate into jobs
Sitharaman said job creation depended on macroeconomic stability, efficient infrastructure, predictable regulations, and wider access to finance and skills.
“Jobs require ecosystems, not isolated interventions,” she said.Citing India's experience, the finance minister highlighted last-mile connectivity to energy and job markets, physical and digital public infrastructure, financial inclusion and trust in market forces as factors that could improve productivity and support employment creation at scale.
She said private enterprises, particularly micro, small and medium enterprises (MSMEs) and startups, would play an important role in creating jobs.
“Most jobs will be and should be created by private enterprises,” Sitharaman said.
However, she said the success of efforts to mobilise private investment should not be judged only by the amount of financing raised.
“Success should be measured not by the volume of financing mobilised, but by outcomes: jobs created and rise in productivity,” she said.
Sitharaman also called for stronger collaboration among the International Bank for Reconstruction and Development, the International Finance Corporation and the Multilateral Investment Guarantee Agency, along with faster operationalisation of the World Bank Group Guarantee Platform.
Developing economies face a shortage of risk capital, she said, adding that guarantees and risk-mitigation instruments could help build risk capital and attract private investment.
Seeks affordable financing, review of governance indicators
The finance minister said the World Bank should continue to support developing economies through competitive pricing, local-currency financing, stronger guarantee products and lower transaction costs.
“Affordable, predictable, and accessible financing must remain and at the core of the Middle-Income strategy,” she said.
Sitharaman also called on the World Bank Group to focus on market failures in areas such as urbanisation, tourism, agricultural exports and critical minerals. She said developing countries could benefit from greater use of artificial intelligence to strengthen state capacity, calling for the technology to receive more attention in the Bank's operational and knowledge agenda.
On the Worldwide Governance Indicators and similar composite assessments, Sitharaman reiterated India's concerns and called for a comprehensive review of existing methodologies.
She said the indicators needed to be transparent, objective, evidence-based and better aligned with current realities and the diverse development experiences of member countries.
“This will be essential for preserving the integrity of the Bank's knowledge products,” she said.
Sitharaman said the success of the World Bank's reforms should be assessed by whether they help countries create jobs, raise productivity, reduce poverty and improve living standards.She also reiterated the need to strengthen the voice and representation of developing countries in the Bank's governance structure.
“Our constituency stands ready to work with fellow shareholders, management, and development partners to advance these objectives,” she said.