Question

Name the agency, which is an agency to provide 'soft loans' to developing countries.

• A. Asian Infrastructure Investment Bank (AIIB)
• B. Organization of the Petroleum Exporting Countries (OPEC)
• C. Asian Development Bank (ADB)
• D. International Development Association (IDA)

Hint:

"Soft loans" = concessional/interest-free loans → always link with IDA, a wing of the World Bank.

Answer 1

The Correct Option is D

Step 1: The International Development Association (IDA) is part of the World Bank Group. 
Step 2: IDA provides interest-free or concessional loans (called soft loans) and grants to the world's poorest countries to support development projects. 
Step 3: Other agencies mentioned: 
- AIIB and ADB provide infrastructure loans, often at commercial rates. 
- OPEC focuses on petroleum policies, not soft loans. \[ \boxed{\text{International Development Association (IDA)}} \]

Answer 2

Comparing each organisation's typical lending terms against the idea of "soft loans" clarifies the answer.

1. Option 1 (AIIB): This bank primarily funds infrastructure projects, generally at standard commercial-style terms rather than concessional soft loans.
2. Option 2 (OPEC): This organisation coordinates petroleum production and pricing policy among member nations, unrelated to development lending.
3. Option 3 (ADB): The Asian Development Bank funds regional infrastructure and development projects, again largely on near-market terms.
4. Option 4 (IDA): As the concessional-lending arm of the World Bank Group, the International Development Association extends interest-free or low-interest "soft loans" and grants specifically to the poorest developing countries.

The concessional, low-interest nature of its lending is what makes option 4 the right choice.

Hence, the correct answer is International Development Association (IDA).