Finance Minister P Chidambaram said he did not “expect the need for another type of Bretton Woods institution” ahead of the 20-country Summit on Financial Markets and the World Economy starting in Washington DC on November 14.
“It’s very difficult to say that we could invent another Bretton Woods type of institution. What we’re trying to do is improve global governance and global oversight of these financial institutions,” Chidambaram said at an on-board press conference.
Reiterating and expanding on Prime Minister Manmohan Singh’s three-point Summit agenda — greater inclusivity, protecting developing countries’ growth prospects and avoiding protectionist tendencies — the finance minister said, “The key point is that we must move towards a new global order that can only be achieved by greater inclusivity in the international financial system.”
“The International Monetary Fund (IMF) has been unable to be an early warning system. The G7, too, is too narrow and small,” Chidambaram said, adding, “More inclusivity would ensure better oversight and serve as an early warning system.”
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Suggesting that India would be focusing on a greater role for developing countries in the global financial system, the finance minister said, “As the world grapples with the crisis, only a handful of countries are driving economic growth, China and India among them. It is very important that countries that can drive economic growth should not suffer in the period during which we grapple with the crisis.”
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To this end, the finance minister said it was important that the crisis was not used as an excuse to go into “a protectionist cocoon”.
“We must try to encourage freer flow of goods, services and capital without which the world will not recover and get back to the growth path,” he said.