Who is Ajay Banga, the Indian American nominated to head World Bank?

Who is Ajay Banga, the Indian American nominated to head World Bank?

He has been identified by the US President Joe Biden as being “uniquely equipped” to lead a top international financial institution like the World Bank “at this critical moment in history”. The 63-year-old Ajay Banga, who will incidentally be the first Indian American to head the World Bank, is a former MasterCard Chief Executive officer with three decades of corporate and banking experience behind him and known for his keen interest in development issues.

According to Joe Biden, Banga has a proven track record managing people and systems, and partnering with global leaders around the world to deliver results. Moreover, Biden pointed out that raised in India, Banga has a unique perspective on the opportunities and challenges facing developing countries and how the World Bank can deliver on its ambitious agenda to reduce poverty and expand prosperity.

Even as the IMF chief Kristalina Georgieva heaped praises in a tweet on Banga’s “executive leadership skills and drive for innovation” and how she admires his commitment to sustainable development, to do good and help those most in need, Krishnamurthy Subramanian, the former top economic adviser to the Indian government, who now serves as India’s executive director at the International Monetary Fund said succinctly on Banga’s nomination, “It’s an elegant solution.”

Banga’s confirmation will be subject to a vote from World Bank executive directors. As the biggest shareholder, the US’s nomination usually ends up being selected.

Who is Ajay Banga?

Banga was born in 1959 in Pune, Maharashtra. Since his father Harbhajan Singh Banga was in the Indian army, he grew up being schooled across India – Jalandhar, Delhi, Shimla and Hyderabad.

Unlike his father, Banga did not opt for a career in the army and instead went on to graduate from St Stephen’s College, Delhi University with a BA degree in Economics. He also did a PGP in Management from the Indian Institute of Management, Ahmedabad. In that respect, Banga stands as an entirely India-minted executive, unlike other business leaders like Indra Nooyi (PepsiCo.), who have a US degree in addition to the ones they earned in India.

Also read: US nominates Pune-born Ajay Banga to lead World Bank

Kolkata branch manager to CEO MasterCard

Banga started his career at Nestle India as a management trainee in 1981 and spent the next 13 years of his career working in sales, marketing and general management. TMC leader Derek O’ Brien remembers him working as Kolkata branch manager of Nestle “dreaming up of the Maggi quizzes three decades ago”.

He later joined PepsiCo’s Restaurants Division, where he was responsible for launching Pizza Hut and KFC in India.

Then he joined Citigroup in 1996 and served in a variety of positions. He went on to become the CEO of Citigroup’s Asia Pacific region and in that role, he was responsible for all of the company’s business lines in the region, including institutional banking, alternative investments, wealth management, consumer banking, and credit cards.

In 2009, he joined MasterCard.  In mid-2010, he became the CEO and a member of the board of directors of Mastercard, moving up from COO.

He was at the helm of Mastercard for 12 years, before retiring as its CEO in December 2021. Under Banga’s tenure, a target was set by the company to bring 1 billion people and 50 million micro and small businesses into the digital economy by 2025. Here, he also averted layoffs of the bank’s 19,000 employees during the COVID-19 pandemic, and pushed work on climate, gender, and sustainable agriculture.

In total, he has more than 30 years of business experience besides being on the boards of the American Red Cross, Kraft Foods, and Dow Inc. Currently, Ajay Banga is the vice-chairman at a private equity firm General Atlantic, a US private equity firm that has invested over $800 million in EV charging solutions, solar power, and sustainable farming.

A keen interest in social development issues

Banga has a keen interest in social development issues. He had previously served on the boards of trustees of Enterprise Community Partners and the National Urban League and was vice-chairman of the board of trustees of the New York Hall of Science. And, was also a director for the council for economic education. Additionally, from 2005 to mid-2009, he spearheaded Citi’s strategy in the microfinance sector around the world.

Banga also served as co-chair of the Partnership for Central America – a coalition of private sector organisations – where he worked closely with US Vice President Kamala Harris to mobilise public, private and non-profit resources for Northern Central America.

Banga has a considerable amount of experience working closely with the US government. In February 2015, he was appointed by then-President Barack Obama to serve as a member of the President’s Advisory Committee for Trade Policy and Negotiations.

Taking on the challenge of climate change

One of the reasons behind Banga’s nomination as the World Bank chief is to bring climate change to the forefront of the 189-nation poverty reduction agency. Banga is well-known for publicly voicing his concerns over the challenges facing the fight against climate change.

Under his tenure as CEO, Mastercard, had led the initiative in 2020 to create the Priceless Planet Coalition,  a group of about 100 companies who were committed towards making corporate investments to prevent the deterioration of the environment.

Banga is co-founder of The Cyber Readiness Institute as well, vice-chair of the Economic Club of New York and served as a member of President Barack Obama’s Commission on Enhancing National Cybersecurity.

Ajay Banga with Modi
In 2014, Ajay Banga met Prime Minister Narendra Modi after a breakfast meeting with American CEOs in New York. Pic: PTI

Advocating strong ties with India

Banga is a champion of stronger ties between India and the US. In 2019, he termed the Indo-US strategic partnership as a kind of “mahagathbandhan” that the world needs adding that the “two greatest democracies” can make a positive difference in the world.

Banga’s management style

In one article, Banga describes his management style as being very passionate, but that he takes time to work his passion. He said that he always tries to understand both sides of the debate “because if you’ve been a banker and worked around the world long enough, you kind of have to understand both sides of the debate”. But, you have to have a point of view, he added and does not believe inducking the issue.

Also, he said once in a lecture that he had realised very early on in his career that if he wasn’t comfortable with himself, then he couldn’t succeed. “It’s critical that you figure out who you are and be comfortable with it,” he advised students in 2014 at NYU Stern, a business college.

On a lighter note, he reminisced that he had enjoyed his time at IIM-A “perhaps a little too much!” He praised the faculty there and recalled having met his wife there.

Ajay Banga, Padma Shri
Ajay Banga being awarded the Padma Shri by the former President of India, Pranab Mukherjee

In 2016, the government of India had awarded him the fourth-highest civilian award, Padma Shri.

Why Banga?

On the role Banga could play as World Bank chief, Luis Alberto Moreno, who worked closely with Banga while serving as president of the Inter-American Development Bank had this to say: “Banga’s work in India and other emerging markets, his “obsession” with expanding financial inclusion, and his deep knowledge of new technologies could help bridge the divide between rich countries and emerging markets.”

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