International Development Association, headquarters, History, Functions

The International Development Association (IDA) is a part of the World Bank Group. It was established in 1960 to provide financial help to the world’s poorest countries. IDA gives low-interest loans and grants to support development projects in areas like education, health, agriculture, infrastructure, and poverty reduction.

International Development Association History

• The International Development Association (IDA) was established on 24 September 1960 as part of the World Bank Group to provide concessional loans and grants to the poorest countries.
• Its headquarters is in Washington D.C.
• It initially focused on infrastructure but later expanded to agriculture (including support to the Green Revolution), health, education, governance and poverty reduction.
• Over six decades, IDA has supported thousands of projects in more than 100 countries, helping them tackle economic crises, natural disasters, conflict and pandemics like COVID-19.
• It also addresses global challenges such as climate change, gender inequality and job creation.
• In recent years, IDA strengthened its financial capacity by receiving a AAA credit rating and entering global capital markets to raise more resources.

International Development Association (IDA) Key Functions

• IDA supports poor countries in education, health, water, agriculture, infrastructure, governance and job creation to reduce poverty and improve living standards. It provides stable financial assistance and acts as an important channel for global development aid.
• It helps countries during crises through the Crisis Response Window (CRW), supporting situations like famine, earthquakes and disease outbreaks.
• IDA also advises on poverty reduction and debt management through policies like the Sustainable Development Finance Policy.
• Under its latest funding cycle, IDA20 (2022–2025), a record $93 billion was mobilized, focusing on climate change, conflict, gender equality, jobs, human capital, debt transparency, governance, technology and crisis preparedness.

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International Development Association (IDA) Governance and Working

• IDA is owned and supervised by 175 member countries. It is funded mainly by contributions from donor governments, which meet every three years to provide fresh funds.
• It works along with the International Bank for Reconstruction and Development (IBRD).
• Since 1960, IDA has provided $600 billion to 116 countries.
• IDA gives funds to the poorest countries based on their low income level (GNI per capita below $1,335 in FY2025) and their inability to borrow from international markets. It also considers how well countries manage their economy and development programs.
• Projects are carried out by the borrowing country with support from the World Bank. 
• Their progress and results are regularly monitored and independent evaluations are conducted to check effectiveness and long-term impact.
• IDA gives financial help to 78 low-income countries through grants and very low-interest loans. It is one of the largest sources of development assistance for these countries, especially for basic services like education and health.
• IDA loans have very low or zero interest and long repayment periods of 30-40 years. Many poor countries receive grants, especially those facing heavy debt problems.
• Thirty-five countries have graduated from IDA assistance and some, including India, later became donor countries.

IDA also supports debt relief through the Heavily Indebted Poor Countries (HIPC) and Multilateral Debt Relief Initiative (MDRI).