India has called for a strong quota-based permanent resource base for the International Monetary Fund, arguing that that IMF would continue to require sufficient resources to respond to actual, potential, or prospective financing needs going forward. In his address to the IMF, Reserve Bank of India Governor Urjit Patel yesterday said that although the quota increases under the 14th General Review of Quotas (GRQ), renewal of New Arrangements to Borrow (NAB) and bilateral commitments have helped in maintaining the current lending capacity, IMF would continue to require sufficient resources to respond to actual, potential, or prospective financing needs going forward, in line with its mandate.
“A strong quota-based permanent resource base for the IMF would serve to strengthen the Global Financial Safety Net (GFSN) and mitigate risks to the international monetary system,” Patel said. India, he said, strongly supports the shared multilateral commitment on completing the 15th GRQ by the 2019 Spring Meetings and no later than the 2019 Annual Meetings. He called for the realignment of quota shares of emerging market and developing economies (EMDEs) whose under-representation has increased further by 0.5 percentage points in the last update leading to underrepresentation of EMDEs by 7.5 per cent.
“We also lend our voice in favour of protecting the quota and voting share of the poorest members under the 15th GRQ,” Patel said. The IMF, he said, should continue to strengthen its capacity for multilateral surveillance to identify evolving global vulnerabilities. The RBI Governor welcomed the emphasis by the Fund on sharpening its toolkit to serve the membership, especially the low income countries (LICs) with meaningful and timely lending support and policy advice.
“We call upon the IMF to develop credible policy advice for re-balancing of the global economy while drawing attention to the adverse implications of policy spillovers on other countries,” Patel said. “The intensifying challenges to multilateralism call for unequivocal and forceful voice of the IMF and WTO in favour of rule-based international trading system and against protectionism,” he added.