Many indeed doubt that the IMF will be able to take the next steps, despite all effort by the management. Many among the developed countries are unreasonably hawkish and wrangle for no good reason.
It is another matter that we need not lose sleep over this event when the IMF and other institutions are struggling to maintain their eminence in a world that is increasingly becoming self-sufficient and cynical. It is reported that Uruguay has joined the new club of countries paying off its IMF debt early. Even so, India must assume greater role in rethinking and reconstructing the global governance system and hopefully save globalisation from short-sighted exploitation.
It is surprising that civilised societies are so reluctant to reduce their voting rights despite the glaring inequity in their action and the increasing irrelevance of such power. The current system perpetuates inequality in decision-making, cornering of global leadership and lack of transparency. At the same time, the system has issued codes, principles and guidelines for promoting transparency in monetary and fiscal policies, sustainability of environment, securing equitable rights, promoting good governance and social responsibility and improving corporate governance standards.
India must play a greater role in reconstructing the global governance system and save it from exploitation
While the African countries and the India-led group may not voice their arguments crudely on the streets like some activists, there is no denying that yet another global institution has come under a severe crisis of credibility, once again. None can understand why Luxembourg has a 3% voting right while Indias has come down to 1.91%. Many ask if global rules are being set by a handful who have no concern for the world at large. While free trade is being seen as a vision, it appears to be increasingly a mirage with hawkish stances that defy logic and humaneness.
In the end, global governance has been taken over by the very same forces and values that perpetuate inequity and promote mindless aggrandisement as an end in itself. No wonder Joseph Stiglitz and many others have commented that the current model does not work.
Obviously, it is being led by countries and players driven by short-sighted considerations than global values or principles. This not only causes resentment, but erodes quickly respect and credibility. True leadership cannot be built on carcasses and desertsfor the so-called leaders will probably soon look like Ozymandias, or worse.
Though WTO itself has been a poor global governance institution due to its structural infirmities and the consensus mandate, its director-general, Pascal Lamy, had pointed to the feeling of dispossession among the developing world in the weak global governance system we are witness to.
But the prospects of true reform are bleak, even if the developing world will account for nearly 90% of the worlds population in about four decades, while the West and Japans share is expected to fall from the current 17% to about 11%. The GDP of the emerging market economies among the G-20 is expected to grow from the current 17% to 70%. Yet, they have little say.
The mighty forces, corporate players and multilateral bodies must note that the world today is indeed warped and explosiveneither round nor flat. The current global governance system is so fragile in character that it will only perpetuate short-sighted actions driven by unsustainable interests. Unfortunately, there are no shared global values as yetonly unshareable interests.