"The one good news is the BRICS pack. That is the one initiative that has come from the emerging markets....The BRICS, their GDP is today better than the advanced world, they have the resources to do it and the also there is a need (for them to grow)," said Stiglitz.
Stiglitz, who is also a professor at the Columbia University, was addressing a seminar on 'Global Financial Crisis: Implications for Developing Economies' organised by the United Nations ESCAP (Economic and Social Commission for Asia and the Pacific).
BRICS which is a grouping of five developing or newly industrialised countries are distinguished by their large and fast-growing or emerging market economies.
However, he said that the emerging countries should rely on each other and internal demand for their growth to keep going as the world economy is not growing well.
"Europe and America were the centre of Lehman Brothers collapse five years back. People in Europe are celebrating the fact that next year the growth is likely to be positive.
"In India an average growth of 5-6 per cent shows that these economies are not performing well...The emerging countries cannot rely on the developed countries as a source of economic growth. They have to rely on each other and on internal demand," he added.
He also said that the creation of euro was a big mistake and there is a need to restructure the euro zone.
"In Europe the fundamental problem is that the euro was a mistake. And the leaders of Europe have not figured out what to do with this big mistake. What is needed is to restructure the euro-zone and that is very difficult."
Stiglitz also said that the single minded focus by the western countries on the inflation was wrong and there should be more focus on employment creation and generation of growth.
Also, the Deputy Chairman of the Planning Commission Montek Singh Ahluwalia who also addressed the seminar, said India's fundamentals are strong and it will not be much affected by global factors.
"For India the fundamentals are strong and savings rate are high...so our investment rate should be about 38 per cent. So somewhere between 2-2.5 per cent is the Current Account Deficit (CAD) that needs to be fair....the percentage of the resources in terms of investment that is going to come from internal sources is very very high.
"So whatever happens on the global front don't make much difference (for India)," Ahluwalia said.