Development issues dear to India to figure on G20 agenda: Montek

Written by fe Bureau | New Delhi | Updated: Oct 30 2011, 05:25am hrs
Euro zone debt crisis with its potential spillover effect could take a lot of the G20 leaders' time at this week's Cannes summit, but development issues dear to India won't be pushed into corner, Planning Commission deputy chairman Montek Singh Ahluwalia said on Saturday. Global food security, infrastructure financing in emerging market economies and employment creation were indeed on the summit agenda, he said.

Acting on the advice of French president Nicholas Sarkozy, billionaire philanthropist Bill Gates would suggest innovative ways to finance development and these would be discussed by the leaders, Ahluwalia, who is India's sherpa to the Nov 3-4 summit, said. India would push for open markets, (increased) market access for its exports and newer ways of infrastructure financing, he said.

Expressing concern over the persistently high global commodity prices that get transmitted to India, he said not only supply constraints, but excess liquidity might also be fuelling these prices. Ahluwalia's comments come at a time when European Central Bank is widely expected to signal its intention to ease next week. A Federal Reserve monetary policy meeting next week is, however, expected to hold US interest rates unchanged, given the somewhat reassuring 2.5% growth reported for the third-quarter.

New Delhi's concerns over excess liquidity inflating global commodity prices are to be seen in the context of the stubbornly high domestic inflation, a large part of which is considered to be from imported fuels/industrial inputs.

European's leaders last week got private investors in Greek bonds accept 50% losses and pledged to boost the firepower of the rescue fund EFSF to 1 trillion euros. Ahluwalia called this "an essential first step. Asked whether and how the rest of the world including India could provide succour to the crisis-ridden Euro zone, he said the IMF would be primary agency responsible for restoring stability in the currency bloc. We (India) will support any reasonable multilateral effort to stabilise the euro zone.

He seemed to vote for a gradual and orderly reduction in the US deficits, rather than sharp contraction now. Ahluwalia cautioned against a worsening of the Euro zone crisis. That (Euro zone crisis going out of hand) would be big news and we won't want that.

Although the IMF would remain the formal forum to spearhead strong, sustainable and balanced growth, the G-20 collective effort, amplified by the Mutual Assessment Process (co-chaired by India and Canada right now) would give valuable inputs to the world body, he said. The MAP will spell out the policy action to be taken by each country.