President Mahinda Rajapaksa today welcomed the formation of the New Development Bank (NDB) by the five Brics countries — Brazil, Russia, India, China and South Africa — at the 6th BRICS summit in Brazil, saying it will assist emerging nations significantly.

“Sri Lanka welcomes the initiative of BRICS leaders to establish a new Development Bank. It will assist emerging nations significantly,” Rajapaksa said in his Twitter account.

The group of emerging economies signed the long-anticipated document to create the $100 bn BRICS Development Bank and a reserve currency pool worth over another $100 bn. Both are expected counter the influence of Western-based lending institutions and the dollar.

Reports say the new bank will provide money for infrastructure and development projects in BRICS countries, and unlike the IMF or World Bank, each nation has equal say, regardless of GDP size.

Each BRICS member is expected to put an equal share into establishing the startup capital of $50 billion with a goal to reach $100 billion.

The BRICS bank will be headquartered in Shanghai, India will preside as president the first year, and Russia will be the chairman of the representatives.