India seeks additional World Bank resources for emerging mkts

India seeks additional World Bank resources for emerging mkts

"While we appreciate the need to focus on stability issues, additional resources for MDBs (Multilateral Development Banks) are also necessary for sustaining growth in developing countries and rebalancing global demand," Indian Finance Minister Pranab Mukherjee said here.

He was participating in a discussion on Development Agenda (Infrastructure and Food Security) for G-20 Development and Finance Ministers' Meeting here on the sidelines of the annual meeting of the International Monetary Fund and the World Bank.

"At present very little funding is available with MDBs relative to the large requirements of EMDCs (Emerging Markets and Developing Countries)", Mukherjee said. The MDBs are institutions that provide financial support and professional advice for economic and social development activities in developing countries.

The MDBs typically refer to the World Bank Group and four Regional Development Banks (RDBs) --  the African Development Bank, the Asian Development Bank, the European Bank for Reconstruction and Development and the Inter-American Development Bank Group.

Mukherjee said that India has been pushing for financing of infrastructure in emerging market countries as a special area of emphasis within the Seoul Development Agenda.

During their meeting in Seoul in November 2010, the leaders of G-20, a grouping of the country's 20 leading industrialised and developing economies, for the first time formally endorsed a G20 development agenda.

The Seoul agenda called for helping the developing countries to build the capacity to achieve and maintain their maximum economic growth potential, in areas like food and income security, infrastructure, trade and jobs.

Mukherjee said that Prime Minister Manmohan Singh, which speaking at Seoul at that time, had "underscored that recycling surplus savings arising out of global imbalances into investment in developing countries for infrastructure and development on a large scale was the best way of rebalancing global demand."

"We feel that MDBs and RDBs have a major intermediation role in this regard. While the G20 has trebled the resources available with the IMF over the past few years, commensurate ambition has not been forthcoming in the case of the World Bank," Mukherjee said.

The minister further said India recognises that increasing agriculture production and productivity on a sustainable basis is the only long term solution to the problems of adequate food grain availability as well as high prices of food commodities.

"Sustainable productivity, better market, information that improves transmission of market signals, more open trade, and sustained investment are vital to boost agricultural growth," he said.

"There are no doubt sharp differences of opinion on what is driving the spike and volatility in commodity prices. "However, it does seem odd that prices should be rising at a time when there is such uncertainty regarding the global recovery and growth.

"The issue of excessive financialisation of commodity markets that can hurt the real economy through high and volatile input prices and increasing food insecurity needs to be addressed strongly by the G20," Mukherjee said.