Asserting that aide by multilateral financial institutions had a crucial role in the growth of countries like India, US Treasury Secretary Timothy Geithner has urged the Congress to support the efforts of the International Monetary Fund and World Bank in this regard.
"In countries like South Korea and India, in Turkey, across emerging economies, investments by the World Bank and the multilateral development banks have helped contribute to rapid economic growth which has supported rapid growth in US exports," Geithner said in his testimony before a key Congressional committee yesterday.
"These institutions, of course, are part of our broad American strategy to protect our national security interests. As former Secretary of Defence Bob Gates put it, development is a lot cheaper than sending soldiers.
"Nowhere is this more apparent today than in the West Asia and North Africa, where these institutions are providing critical assistance to countries like Libya and Tunisia," he said.
Multilateral development banks (MDB), he argued, are also highly effective in multiplying the impact of US investments.
With just 5% share of the functional in 50 accounts, Treasury's international programmes will make possible, among other things, nearly $80 billion in MDB commitments in 2012-2013 alone, he added.
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"A 10% -- just another example -- a 10% increase in the total US commitment to the IDA, the International Development Association, helped generate a 20% increase from other donors.
And our contributions to the Global Agriculture and Food Security Programme have been matched by additional contributions from donors, about double our level of contributions," Geithner said.
The Obama Administration has requested a total of $2.9 billion, an increase of $239 million, 9% above 2011-12, for international financial institutions such as the World Bank, as well as debt relief and technical assistance programmes.