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| Give more power to developing nations in World Bank: Pranab |
| Press Trust of India / Istanbul/ New Delhi Oct 05, 2009, 19:12 IST |
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Taking the G-20 nations' decision forward, India today pitched for a six per cent shift in voting power for developing countries in the World Bank and cautioned against any complacency by the lender in helping them tackle the impacts of the financial crisis.
"We should carry forward the decision taken at Pittsburgh (G-20 meeting) and aim at six per cent shift in voting power to developing and transition countries," Finance Minister Pranab Mukherjee said at a meeting of the Development Committee of the World Bank in Istanbul.
Ahead of annual IMF-World Bank meetings in the Turkish city, he said such a significant shift in voice for developing countries alone would bring parity in the governance of the World Bank.
He suggested that economic weight of a country must be the primary criteria in any methodology for any realignment of voting powers in the World Bank.
Mukherjee said GDP at Purchasing Power Parity should be the most relevant measure. Instead of economic growth as given in a country's currency, purchasing power parity measures the GDPs of countries by comparing purchasing power of their respective currencies.
Calling for a World Bank specific formula for voting power, he said it should not be linked to IMF.
While praising the role of the World Bank in helping developing countries tackle the impact of financial crisis, he warned against complacency given the "uncertain trajectory of recovery".
"Developing countries need a reliable lender who can provide adequate financial resources at a stable and cheaper rate," Mukherjee said.
The G-20 leaders had earlier agreed to shift five per cent voting power in IMF to emerging nations, where as these countries were demanding at least seven per cent.
IMF Committee has agreed to shift five per cent voting power to emerging nations.
Mukherjee also supported increasing the capital of the World Bank and the International Finance Corporation, which is part of the global lender.
About the quota issue for developing nations, IMF Managing Director Dominique Strauss-Kahn yesterday said the total shift would still be more than seven per cent.
"Let me remind you that we are still working, implementing the shift of 2008, which is 2.7 per cent. So 5 plus 2.7 per cent would be in total a shift of 7.7 per cent," he noted.
BRIC nations had demanded at least seven per cent shift in voting power in IMF to emerging nations.
At Pittsburgh, Prime Minister Manmohan Singh had described the G-20 decision to raise the voting share of emerging nations in the IMF to five per cent as a "compromise".
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