strategies for development

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the world bank was set up to grant long term loans for internal development projects of a country.

NGO's aid is considered to be better than governmental public aid because it cannot be used for soft influence.

world bank gives loans at market rates of interest for projects of infrastructure development that commercial banks would find risky.

focuses on poverty reduction strategies. gives aid for accessing basic amenities, prevention of diseases and broadening education. 

IMF was set up for short term loans to countries experiencing BOP deficits.  countries borrow when they need foreign currency reserves or cannot get FDI or portfolio investments to balance their current account deficit.

Terms of the IMF :- 1) contractionary fiscal and monetary policy. 2) trade liberalization 3) encouraging FDI. 4) devaluing official exchange rate.

advantages of IMF :- 1)Reduces domestic inflation level as govt. spending falls. 2)encourages local firms to be more efficient as they are faced with more MNC competition. 3)cheaper exchange rate encourages exports 4)More FDI would


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