Too big to be ignored
Prime Minister Manmohan Singh's remarks that the current financial crisis has created conditions for a shift in global economic relations is not strictly correct.
India will try to ensure funds to developing world do not dry up
NEW DELHI: Prime Minister Manmohan Singh's remarks that the current financial crisis has created conditions for a shift in global economic relations is not strictly correct.
Much before the current financial meltdown, the importance of emerging economies was being noted by the world's richest industrialised nations. This is why leaders of India, China, Mexico, Brazil and South Africa were invited to be part of the outreach session during the G-8 summit.
The fact that economic power would gradually shift to the Asia-Pacific region because of the rise of the two big economic giants, India and China, has long been expected.
After all, India has a population of over one billion and China's is more than India's. Besides, their rate of growth is much more than in the developed world.
It is true that a nervous America and Europe are now looking to get more countries on board for combined action to combat the financial crisis. Yes, India is pleased that it is an invitee but so is Mexico and Brazil.
Finance minister P Chidambaram, who accompanied the PM to Washington, at the economic summit earlier this week told reporters that the G20 would be the single most important forum to address global economic and financial issues. Yet, because it was hosted by a lame duck administration, there is some doubt about its fate. "It is not clear to us whether the new administration is fully on board with what the outgoing administration has put on the table," Chidambaran frankly admitted.
Prime Minister Manmohan Singh's agenda at the G-20. was simple. "The main aim was to make sure that the industrialised nations don't move into a protectionist mode, and to ensure that the flow from the international lending institutions to the developing world does not stop. We need the funds for our infrastructure projects," says Rajiv Kumar of ICRIER (Indian Council Of Research in International Economic Relations).
"In this hour of crisis the world is gradually realising that a few industrialised nations cannot dictate terms. Everyone's voice must be heard. A country as big as India cannot be ignored when it comes to shaping the new financial order," says former foreign secretary K Raghunath.