Sri Lanka will support establishing a bank among South Asian Association for Regional Cooperation (SAARC) countries to help finance infrastructure development in the region, Sri Lankan central bank governor said on Thursday.
Ajith Nivard Cabraal told Business Standard India that Sri Lanka has been "supportive of that (formation of SAARC Bank) from the beginning when it was mooted," and the proposed financial institution will help in alleviating poverty in the South Asian region.
The governor said, "We believe that, because we are like minded people in the region, it will have an impact. The SAARC Bank can offer block loans to banks which can be redistributed amongst the poorest sections. The bank can look at the prosperity in the region."
If agreed by member countries, the bank would be the first for the eight-nation regional grouping, and it will provide countries with access to capital to finance infrastructure for trade facilitation and development.
The SAARC Bank will be formed on the lines of the New Development Bank (NDB) announced in July by the BRICS grouping -- Brazil, Russia, India, China and South Africa.
While NDB, to be headquartered in Shanghai, will finance infrastructure and development projects across the developing world, the proposed South Asian development bank will focus on the eight SAARC nations -- Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka.