India fails to secure vice presidency of China-backed AIIB

India, which is the second largest stake-holder in the China-backed Asian Infrastructure Investment Bank, has failed to secure a guarantee for the institution's vice presidency even as it asserted that Beijing has no veto rights despite having a say in its functioning, reported PTI. Additional Secretary of Ministry of Finance Dinesh Sharma said that India could not press for the vice presidency as AIIB decided to hire meritorious candidates for such posts, instead of allotting it to countries based on shareholding. "Though we argued for it. I personally was happy to loose that argument because they said the candidates will be decided by merit," Sharma said. AIIB wanted to avoid the patron of allotment of posts followed by the BRICS New Development Bank, under which posts were decided by rotation, he said. Sharma said he was "happy to loose" India's argument for Vice President post as institutions like the IMF and the World Bank were criticised for appointing only US and EU officials. Asked how China got the presidency, he said it was not a cakewalk for Beijing as Russia had fielded a candidate, but it later withdrew. "Chinese could not ensure the Presidency with their share holding. There is no insurance that China will have their President always. They have to get 50 per cent others to get President post. They can not ensure it," he said. He also said China has no veto over the Bank. "It has been ensured that the bank has truly multilateral operational principles not a 'Chinese Exim Bank' with veto rights for China," Sharma said. India has been with China from the beginning ever since it was mooted by Beijing in 2013, he said. China is the largest stakeholder with 26.06 per cent voting shares. India is the second-largest with 7.5 per cent, followed by Russia 5.93 per cent and Germany 4.5 per cent. "People were sceptical about the bank, including in India. But it was found in the course of meeting that the architecture followed by AIIB is currently followed by IMF and Word Bank," he said. "When we went through the details we found that it was not something that what was feared to be a Chinese Exim bank with a different name. That is what the earlier fears were," Sharma said. "The baby appears to be a truly a multilateral bank," he said and complimented AIIB President and ex-Chinese Finance Minister Jin Liqun for his efforts to bring about diversity. The operational structure was such that even with 25 per cent share, China requires "super majority" to push any of its own agenda, he said. The bank's structure has "simple majority, special majority and super majority" principle, Sharma said. "I do not say China has veto but major changes can not be made without China in it," he said. "Going by the articles of association it can not be called a Chinese bank." To a question about whether AIIB will take up financing of the USD 46-billion China-Pakistan Economic Corridor, which India has objected, Sharma said care has been take to avoid funding projects in the territory claimed by another country. "Mutual consent is required in such cases," he said.