India against changes in IMF quotas

Finance Minister P Chidambaram has vehemently opposed any changes in the shareholding (or quotas) of developing countries in the International Monetary Fund (IMF).

The issue will figure prominently in the IMF board of governors' meeting in Singapore next month, which the finance minister is scheduled to attend.

China, South Korea, Turkey, and Mexico are likely to get their IMF quotas increased, according to Financial Times, which quoted IMF Managing Director Rodrigo Rato to this effect. The move is being touted as an early step towards giving large developing countries more say in the institution.

When asked, a senior finance ministry official said: "No final decision has been taken by the IMF as yet to provide these four countries a modest increase in their quotas. The finance minister has made it clear and is vehemently opposed to anything that hurts India's interests. In fact, India is the main opponent to the changes."

North Block is also adamant that any new formula should reflect India's growth and contribution to the global economy. The official added that it was not possible yet to quantify the impact of the proposed changes on India.

"Discussions are still on. In any case, whatever be the changes, the impact on India will be very small. There is no question of India losing its permanent chair."

On the reasons for India's opposition, the official said the formula for calculating a country's quota was "admittedly flawed."