ON Oct 21, 21 Asian countries became founding members of the China-led Asian Infrastructure Investment Bank (AIIB). These were Bangladesh, Brunei, Cambodia, China, India, Kazakhstan, Kuwait, Laos, Malaysia, Mongolia, Myanmar, Nepal, Oman, Pakistan, Philippines, Qatar, Singapore, Sri Lanka, Thailand, Uzbekistan and Vietnam.

The founding members are expected to sign and ratify the articles of agreement in 2015, and the AIIB will start functioning formally in late 2015. The authorised capital will be US$100 billion, and the initial subscribed capital will be around US$50 million. The paid-in ratio will be 20 per cent. The headquarters of the bank will be in Beijing. Its head will be Jin Liqun, former vice-finance minister of China and ex-vice-president of the Asian Development Bank (ADB).

Voting rights and its modalities of operation will be decided after consultations between the founding members. The rights are likely to be decided on a combination of gross domestic product (GDP) and purchasing power parity. On that basis, China will be the largest shareholder of the bank, followed by India.