Pranab to meet IMF chief tomorrow

Finance Minister Pranab Mukherjee is scheduled to meet IMF Chief Dominique Strauss Kahn here tomorrow in the backdrop of a global consensus being reached for reform of the financial body by giving more voting rights to emerging market economies.

Kahn, the Managing Director of the International Monetary Fund (IMF) and a former French Finance Minister, will also address Indian industry captains during his visit here.

Global leaders had agreed to give more say in the IMF to emerging economies at the G-20 Summit in Seoul last month, so that it "better reflects the changes in the world economy".

The grant of a 6 per cent additional voting quota to emerging economies will push up India's rank in the IMF to 8th from 11th at present in terms of voting powers. Neighbouring China will also see its ranking improve to 3rd place from 6th at present.

Voting rights in the IMF are based on various parameters like a country's GDP, openness, forex reserves, etc.

India and other emerging market economies have been demanding reform of the IMF to give more powers to them, in line with their increasing share of total global trade.

Emerging market economies contribute around 47.5 per cent to the global economy in terms of purchasing power parity, but only enjoy 39.5 per cent of voting rights in the IMF.

Their voting rights in the 187-nation body IMF will increase to over 45.5 per cent once the reform measures are implemented.

As part of the reform agenda, Europe will give up two of the eight or nine seats it controls at any given time on the IMF's executive board, which will continue to have 24 members.

The next phase of IMF reforms will start in 2013.