Addressing climate change is one of the greatest challenges of our era, and the financial resources required are immense: the IPCC Sixth Assessment Report (AR6) estimates that annual climate investment needs must reach approximately USD 2.4 trillion per year for the energy sector alone to limit global warming to 1.5°C — and three times higher if transport and other sectors are included — while actual climate finance flows remain far short of these levels, with the investment gap having widened considerably in recent years

Environmental and social (E&S) sustainability is a must for all projects financed by the NDB. NDB Environment and Social Framework (ESF) and NDB Environment and Social Standards (ESS) are applied to all projects financed by NDB to ensure that projects adequately assess and mitigate their E&S impacts and risks. Unlike traditional multilateral development banks, NDB promotes the use of strong country systems for achieving projects’ compliance with NDB ESF/ESS. This approach fosters local ownership of project outcomes, reduces implementation delays and transaction costs, enhances clients’ capacity, and strengthens the member country’s institutions and systems.

Local currency financing (LCF) has become an increasingly important element of the BRICS agenda and broader MDB reform efforts to strengthen financial resilience and support sustainable development. The New Development Bank (NDB) has emerged as a leading provider of LCF, expanding both local currency funding and lending through direct access to member-country capital markets. NDB’s experience demonstrates a pragmatic, market-oriented approach that reduces foreign exchange risks, supports domestic capital market development, and advances the use of member countries’ national currencies in development finance.

This thematic paper examines how the New Development Bank (NDB) operations contribute to development impact beyond physical infrastructure delivery. It analyses evidence from 17 completed NDB projects across clean energy and energy efficiency, transport infrastructure, and COVID-19 emergency response operations, while also reviewing development impact practices across peer MDBs. The analysis suggests that NDB-financed projects generated measurable socio-economic benefits beyond infrastructure outputs. Renewable energy projects in China and India exceeded several power generation and greenhouse gas reduction targets while contributing to technological innovation and cost reduction.