G20 must help bridge infrastructure gap: Manmohan Singh (Roundup)

SEOUL - Prime Minister Manmohan Singh Wednesday pushed for a new rebalance of the global financial system in a manner that will assist flow of capital from rich states to deficit countries to fund infrastructure, while cautioning against protectionism.

The prime minister, who reached here in the evening for the G20 Summit, said the forum must also focus on the development agenda while addressing the current global economic crisis and assured that India will be an active player in this regard.

“The world economy is on the path of recovery but we should keep our focus on how to optimize global outcomes in an increasingly inter-dependent world,” said the prime minister ahead of the summit Thursday-Friday.

“Given the vast development challenges we face, it is in India’s interest to have an open, stable and rule-based international economic environment, whether in the field of trade, investment flows, technology transfers or open markets.”

The prime minister said that given the theme of the Seoul Summit - “Shared Growth Beyond the Crisis” - expectations the the world over had moved beyond the current crisis to ensuring sustained and balanced growth.

“We have to be particularly wary of protectionist sentiments. There are also developmental imbalances within and between countries, and rebalancing of the world economy is a major challenge,” he added.

The prime minister had earlier mentioned about the need for rebalancing during the joint press conference in New Delhi Monday with US President Barack Obama - whom he will meet at the G20 Summit again - which was endorsed by Washington.

“We must also give a thought to how we can leverage global imbalances to bridge the infrastructure gap between the rich and poor countries,” the prime minister once again said, reflecting on what he meant by rebalancing.

At this G20 Summit, the Indian delegation - which includes Planning Commission Deputy Chairman Montek Singh Ahluwalia, Foreign Secretary Nirupama Rao and Finance Secretary Ashok Chawla - is expected to have more clout than before.

As the prime minister mentioned in his pre-event statement, India last week finally secured its long-standing demand of higher voting rights for itself and some key emerging economies at the International Monetary Fund.

This apart, President Obama, during his four-day visit to India that concluded Tuesday, called upon New Delhi to assume a more meaningful and leadership role in global affairs - which India readily said it would.

“India will actively participate in this process to strike the right balance between ensuring its credibility and national interests of countries,” the prime minister said in his pre-summit remarks.