RICHARD LAMBERT, director general, Confederation of British Industry and former editor of the Financial Times worries that protectionist measures taken by leading G20 nations are not a good sign for the discussions that will continue in Pittsburgh, USA, later this week. He commends India’s recent stand on issues like climate change, in an interview with S Kalyana Ramanathan. Excerpts:
Despite the repeated commitments made at the earlier meetings, most members of the G20 continue to execute protectionist measures to safeguard their own interests. Your comments?
I agree there have been some lamentable moves by the developed economies in the recent past, which run counter to what they have said at the G20 meetings, like the US move on the tyres (against China).
Wouldn’t that raise the question of the relevance of the G20 itself, when major developed nations are reeling under the strain of the current recession?
The question is where would we be if the G20 did not exist. If the G20 was not there, would things be worse? I think the answer is yes. If you look at what has happened in the last year to 18 months, we see protectionist measures have taken place. But these add to a modest share in the global GDP, like 1 per cent. But if you look at the time of the great depression in the 1930s, at the end of the very first year, protectionist measures were adding up to 10 per cent of the global GDP. Compared to what might have happened if the G20 did not exist, its a good story.
You had earlier commented on the signs of recovery in developed countries like the US and Germany. What’s your take on the emerging economies?
I am not up to speed on the Bric countries generally. But my perception of China is that it will reach its growth target for this year. It is very heavily driven by the stimulus. China will need global and fiscal stimulus to continue to grow. For India, the numbers look promising, but we have to see what the bad weather (drought) is going to do the the economy. I haven’t seen the numbers on that.
Is it fair on the part of developed nations to press India to reduce carbon emission if it needs financial support from the west, when India is not a major polluter, relatively speaking?
I don’t think it is a fair summary of the position. If you look at the European Union, it has committed to make massive cuts in greenhouse gas emission in 30 years. The US is debating its approach to cut emission. We hope it will arrive at a position in time for the Copenhagen meet (in December). The greenhouse gas emission per head in India is very low,a quarter of what they are in UK. But there are a billion Indians (laughs). I think Prime Minister Manmohan Singh is making wise comments on the need for greater energy efficiency and for India to find ways of cutting emission in a efficient way when the demand for energy is going to grow.