Gains seen for rising powers like India at G20 Summit

NEW DELHI - Restructuring the 66-year-old International Monetary Fund (IMF) with a greater say for countries like India and measures to ensure sustained global economic recovery will top the agenda of the coming G20 Seoul Summit, a top official has said.

“I hope substantive decisions will be taken on IMF reform at the November Seoul Summit. The institution has to reflect the changing global economic scenario,” Changyong Rhee, secretary general of the Presidential Committee for the G20 summit, told IANS. during a visit here

“The US has a voting weight of 17 percent. This amounts to veto right on major decisions that require an 85-percent-plus vote. European countries have nine chairs within its 24-seat board. So the structure is obviously not in line with today’s realities,” he said.

“This structure needs a change. Developing countries like India and China need to have a much greater say in global economic matters,” Rhee said, reflecting what has been the stand of Indian interlocutors at G20 meetings.

The heads of state meeting of the group of 20 developed and emerging economies is scheduled to be held in Seoul on Nov 11 and 12. This will be the fifth summit of G20, with the previous ones at Washington, London, Pittsburgh and Toronto.

The US and European countries dominate the IMF, created in 1944 to promote international monetary cooperation and exchange rate stability. The main job of IMF is to raise a pool of emergency funds from members and lend them when their economies are in trouble.

“Major issues are related to over-representation and under-representation of members, the process of selecting the IMF chief, quota formula and currency swaps,” Rhee said. “The reform will fundamentally change IMF’s decision-making process and governance.”

The Harvard-educated economist, now in charge of preparations for the Seoul Summit, said ensuring fiscal coordination among G20 member countries will be another dominant issue at the meeting, where India will be led by Prime Minister Manmohan Singh.

“Market expectations for fiscal coordination among G20 members is very high. People are expecting concrete action. On financial regulation, 47 issues have been identified out of which 46 had already been discussed among the top policy makers,” he said.

Rhee was, however, candid enough to admit that he had little expectations on any major decision on getting the Doha round of world trade talks back on track, even though the G20 leaders were expected to discuss the issue.

“The Doha round will be a part of the agenda. But I am not very optimistic on it,” he said, referring to the stalled negotiations under the World Trade Organisation, launched in the Qatari capital in 2001, to boost global trade by reducing trade barriers.

(Gyanendra Kumar Keshri can be contacted at gyanendra.k@ians.in and biz@ians.in)