Answer: 

Introduction:

India’s recent decision to become a founding member of the New Development Bank (NDB) and the Asian Infrastructure Investment Bank (AIIB) has generated interest in the role these two banks will play.

Body:

Understand the differences:

Role and Function:

• The NDB, also known as the BRICS bank, is primarily focused on funding sustainable infrastructure development projects in member countries, with a particular emphasis on emerging economies.
• The AIIB, on the other hand, is a multilateral development bank that aims to fund infrastructure development projects in Asia and beyond.

Membership and Governance:

• The NDB has five founding members – Brazil, Russia, India, China, and South Africa – and each member has an equal say in its governance.
• The AIIB has 103 approved members, with China being the largest shareholder, and decisions are made through a board of governors representing all members.

Strategic Significance for India:

• Joining the NDB and AIIB provides India with access to additional sources of funding for its infrastructure development projects, which are critical for the country’s economic growth.
• India’s membership in these banks can help strengthen its position in the region and provide opportunities for collaboration with other member countries. Exactly how ?
• Both banks offer India an alternative to traditional Western-dominated financial institutions, providing a greater voice and influence in the global economic system.
• India must balance its strategic interests with the potential risks and concerns related to Chinese dominance in both institutions.

Conclusion:

The NDB and AIIB have different roles, with NDB emphasizing on sustainable development and AIIB focusing on infrastructure. Both banks offer funding opportunities for India’s development needs, while also allowing India to shape their policies and governance as a founding member, strengthening economic ties with other countries.