Kuwait City, August 7 :

Oil-rich Kuwait decided yesterday to give $300 million to a poverty fund set up by the Islamic Development Bank (IDB) to help poor Muslim nations, the state KUNA news agency reported.

The contribution was approved at the weekly cabinet meeting, a cabinet statement said. The IDB board of governors agreed to set up the fund during its annual meeting in Kuwait in May. Its capital is expected to be around five billion dollars.

The idea of the fund was proposed by Saudi King Abdullah at a summit of the Organisation of the Islamic Conference (OIC) held last December in the holy city of Mecca.

Saudi Arabia has earmarked one billion dollars to the fund, which will offer assistance to the least developed Muslim countries. IDB president Ahmad Mohammad Ali has said the fund is not expected to start operations before the next annual board meeting scheduled in Senegal next year.

The IDB is the economic arm of the 57-member OIC and was established in 1975. Its board of governors is made up of finance or economy ministers of member states.

The IDB, which gives low-interest loans, has so far extended a total of $38 billion to Islamic countries.