The New Development Bank (NDB) opened in Shanghai on Tuesday to finance infrastructure projects, mainly in BRICS countries.

BRICS countries are the world’s major emerging economies: Brazil, Russia, India, China and South Africa.

BRICS leaders signed an agreement to establish the bank during their sixth summit in Brazil in July, 2014. The bank will start operations at the end of this year or early in 2016.

Chinese Finance Minister Lou Jiwei, Shanghai Mayor Yang Xiong and NDB President K.V. Kamath from India attended the opening ceremony.

The NDB will supplement the existing international financial system in a healthy way and explore innovations in governance models, Minister Lou said at a seminar following the ceremony.

“We are committed to working closely with the New Development Bank and other multilateral institutions, offering to share our knowledge and to co-finance infrastructure projects.

“These types of partnerships will be essential to reach our common goals to end extreme poverty by 2030, boost shared prosperity, and to reduce inequalities.”

The NDB will have an initial authorised capital of $100 billion, and initial subscribed capital of $50 billion “equally shared” among the five founders.

Equal shares among the five members will ensure equal dialogue and serve as a model for innovation to global governance, said Xu Xiujun, a researcher with the Institute of World Economy and Politics of the Chinese Academy of Social Sciences.

The first chair of the board of governors will be from Russia, the first chair of the directors from Brazil, and the first president from India.

The bank was formerly set up at a meeting in Russia on 7 July this year with Kamath chosen as president.

Kamath is credited with turning ICICI Bank ­- an Indian multinational banking and financial services company – into one of India’s largest private lenders during his 13 years as managing director and CEO.