NDB finances projects to help build more inclusive, resilient, sustainable future

The New Development Bank (NDB), formerly referred to as the BRICS Development Bank, is a multilateral development bank established by the BRICS states (Brazil, Russia, India, China and South Africa). NDB finances projects and innovates tailored-solutions to help build a more inclusive, resilient, and sustainable future for the world.

Almost two years ago, the bank had set up a regional office in India for funding and monitoring infrastructure projects in that country and Bangladesh. The Indian Regional Office is supposed to be instrumental in enhancing NDB's engagement with borrowers and stakeholders. By the end of 2023, it approved 27 projects in India (25-sovereign and 2-non-sovereign), entailing an investment pledge of well over $8.6 billion.

Speaking to Bizz Buzz exclusively, Ashwani Muthoo, Director General of the Independent Evaluation Office of the NDB, explains how they recognise the importance of inclusive and transparent evaluation processes that actively engage all relevant stakeholders, NDB’s journey so far in India and the way ahead.

The NDB's investments in India have been significant. Can you provide us with a comprehensive overview of the nature and distribution of the projects approved by the NDB by the end of 2023?

The NDB has played a pivotal role in advancing India's development agenda by approving 27 projects by the end of 2023. Among these, 25 were sovereign operations, indicating direct collaboration with the Indian government, while 2 were non-sovereign operations involving private sector entities.

Notably, one of the non-sovereign operations included an equity investment, showcasing the bank's diverse investment portfolio. These projects span critical sectors aimed at addressing India's infrastructure and socio-economic challenges.

For instance, 14 projects have been dedicated to enhancing roads and transport infrastructure, specifically focusing on improving road connectivity and urban mobility. Additionally, seven projects have been initiated to bolster water and sanitation infrastructure, ensuring access to clean and safe water across various communities. The remaining five projects encompass themes such as clean energy, Covid-19 emergency assistance, and multi-dimensional projects aimed at addressing complex developmental challenges.

Could you throw some light on the financial aspects of these projects? Specifically, how much capital has the NDB invested in these initiatives, and what percentage of these funds have been disbursed to date?

The NDB's investment commitment in these 26 projects amounted to $8.6 billion by the end of 2023. However, it's essential to note that while the total approved amount is significant, only 44 per cent of these funds have been disbursed thus far. This indicates that there is still a substantial portion of funds yet to be utilised, underscoring the ongoing nature of these development initiatives and the phased manner in which they are implemented.

Could you elaborate on the geographic distribution of these projects within India? Are there any regions that have received a more significant share of investments?

The NDB's investments have been strategically distributed across various States and Union Territories within India. By the end of 2023, projects had been approved in 13 different regions, reflecting a comprehensive approach to addressing development needs across the country.

Interestingly, Madhya Pradesh emerged as a focal point, with the highest number of approved projects, totaling five. This distribution underscores the bank's commitment to fostering inclusive growth and development by targeting regions with diverse developmental challenges.

Given the global challenges posed by the pandemic, how significant has the NDB's support been in addressing these challenges in India? Additionally, could you highlight other sectors that have received substantial investments from the NDB?

The NDB's response to the pandemic has been robust, with significant investments directed towards addressing the socio-economic impacts of the crisis in India. Emergency support for Covid-19 challenges received the second-largest investment, totaling $2 billion, which accounted for 23 per cent of the total approved loan amount. This support has been instrumental in providing much-needed relief and bolstering resilience in the face of the pandemic.

Furthermore, as mentioned earlier, investments in sectors such as water and sanitation have also been substantial, with $1.39 billion allocated across seven projects. These investments underscore the bank's commitment to addressing critical developmental priorities and building sustainable infrastructure that can withstand future challenges. The Independent Evaluation Office conducted a comprehensive evaluation of the bank’s Covid-19 emergency response loans.

Could you provide examples of projects that have been fully disbursed and those with multiple tranches? How does the bank ensure the effective utilisation of funds in these projects?

The projects that have been fully disbursed are the REC renewable energy project, the MP road projects, and two Covid-19 emergency support projects. These projects serve as a testament to the bank's ability to effectively execute and conclude development initiatives, thereby delivering tangible impact on the ground.

Additionally, we have several projects with multiple tranches, including the Bihar Rural Roads Project, the MP Bridges Project, and the Rajasthan Water Project. The phased disbursement approach ensures that funds are allocated prudently based on project milestones and performance indicators. This allows for greater flexibility and accountability in project implementation, maximizing the impact of the NDB's investments in India's development journey.

Moving to evaluation, traditional evaluation approaches are often criticized for their limitations in fully capturing the learning opportunities inherent in the evaluation process. How does the NDB plan to address these shortcomings and foster a more collaborative approach to evaluation and learning?

Traditional evaluation approaches indeed have their limitations, often failing to fully tap into the wealth of insights that emerge throughout the evaluation journey. At the NDB, we recognise the importance of shifting towards a more collaborative evaluation and learning framework.

By harnessing the collective wisdom and action of diverse stakeholders, including policymakers, practitioners, researchers, and civil society representatives, we aim to drive more effective and sustainable development outcomes. This collaborative approach not only enriches the evaluation process but also ensures that the analysis remains independent and the integrity of the evaluation function is upheld.

Through initiatives such as industry events, peer-learning exchanges, and knowledge-sharing platforms, we seek to facilitate dialogue and knowledge exchange, thereby maximising the impact of our evaluations on development interventions.

The NDB's Independent Evaluation Office (IEO) plays a crucial role in ensuring the quality and integrity of evaluation practices within the bank. Could you elaborate on how the IEO's expertise in evaluation methodologies contributes to the bank's commitment to professionalizing evaluation and fostering an evaluation culture?

The NDB's IEO serves as the cornerstone of our commitment to excellence in evaluation practices. Through Corporate Level Evaluations, Thematic Evaluations, and Project Performance Evaluations, the IEO employs rigorous methodologies to assess the effectiveness and impact of our operations. What sets the IEO apart is its relentless pursuit of innovation in evaluation techniques.

By incorporating data analytics, participatory approaches, and emerging technologies into our evaluation methodologies, we ensure that our evaluations remain at the forefront of best practices in the field. This not only enhances the credibility and relevance of our evaluations but also fosters a culture of continuous learning and improvement within the bank.

In collaboration with the NDB Management, IEO also established an Inter-Departmental Working Group (WG) on Evaluation, as a platform for exchanging knowledge and information, and discussing evaluation matters of shared interest and importance.

As we approach the conclusion of two years since the inception of the IEO, our commitment to advancing the professionalisation of evaluation remains unwavering.

As you mentioned, collaborative evaluation emphasises the active participation of various stakeholders in the evaluation process. How does the NDB ensure that all relevant parties, including program staff, beneficiaries, and funders, are effectively engaged in this collaborative approach, and what benefits does this inclusive process bring to the evaluation outcomes?

At the NDB, we recognise the importance of inclusive and transparent evaluation processes that actively engage all relevant stakeholders. Collaborative evaluation, as a cornerstone of our approach, prioritises partnership, shared decision-making, and mutual learning among all involved parties, including program staff, beneficiaries, funders, and other relevant stakeholders.

To ensure effective engagement, we employ a range of strategies, such as stakeholder consultations, participatory workshops, and multi-stakeholder forums, to create opportunities for meaningful dialogue and collaboration throughout the evaluation journey. This inclusive approach not only enhances the credibility and relevance of the evaluation process but also brings diverse perspectives and insights to the table, enriching the quality of evaluation outcomes.

By fostering a culture of openness, trust, and collaboration, we are able to generate more actionable insights that contribute to improving programme effectiveness and achieving sustainable outcomes for the communities we serve.