Prime Minister Manmohan Singh today said the first summit meeting of the BRIC countries discussed the US dollar as the leading international reserve currency, but it was not an easy issue.
Speaking to reporters accompanying him back from the meeting in Yekaterinburg, Russia, Singh said: “The currency was discussed. But it is a complex issue. Which are those currencies (which can be the alternative to the dollar)?” The finance ministers of the four BRIC countries — Brazil, Russia, India and China — will hold discussions to take the matter forward.
In his first interaction with the press since he took charge for a second term, the Prime Minister also called for peace with Pakistan and said he had already achieved it at home with L K Advani, the Leader of Opposition.
Roughly one-third of the US Treasury debt held by foreign countries lies in the BRIC economies, which together represent 42 per cent of the world’s population and 25 per cent of its land coverage. China alone holds roughly $1 trillion in US government debt — more than any other economy.
There was speculation that the group’s first full-format summit in Yekaterinburg on Tuesday would make a specific call for a shift away from dollar assets and creation of a supranational reserve currency.
The day before the meeting, Russian President Dmitry Medvedev said: “The existing set of reserve currencies, including the US dollar, has failed to perform its functions. We will not do without additional reserve currencies.”
However, the joint statement issued by the four leaders after their meeting was much muted.
It did not even mention the dollar — merely called for a “more diversified currency system” and greater voice to emerging economies in institutions like the International Monetary Fund and the World Bank.
About the other high-profile meeting the Prime Minister had on this tour — with Pakistan President Asif Ali Zardari — he said India wanted to try again to make peace with Pakistan but Islamabad should take “strong and effective” actions to end terrorism against India, like it had done with regard to the Taliban.
“As I have said before, we can choose our friends, but we have to live with our neighbours.”
Singh said Zardari had told him that he was sincere in fighting terrorism but talked about difficulties his government was facing in tackling the menace and sought “some time”.
In response to a question on the turbulence in the Bharatiya Janata Party (BJP), the main Opposition, Singh said he was not in favour of gloating over difficulties of other political parties. “I wish them well.”
BJP leader L K Advani, the Prime Minister said, had called him up to express “regret” over his utterances during the elections and that he reciprocated the gesture by apologising.
“When he (Advani) rang up on May 16 to congratulate on the election results, he expressed regret. I also conveyed my apologies if I had hurt him,” Singh said, adding that he was looking forward to “close” relations with Advani as the Leader of Opposition.
Govt will pursue reforms: PM
Prime Minister Manmohan Singh on Wednesday said the government will pursue reforms as outlined in the President’s address to the two Houses of Parliament after the constitution of the new Lok Sabha. In response to a question on how the government will proceed since the strong mandate in the elections has heightened expectations of rapid reforms, Singh said the President’s address had clearly outlined the government’s priorities.
President Pratibha Patil’s speech presented an action-packed agenda loaded in favour of the social sector and inclusive economic reform, with a heavy accent on monitoring expenditure.
The intent is to push forward reform in banking and insurance — which had stalled owing to Left pressure during the United Progressive Alliance’s first stint. The government would recapitalise state-owned banks and bring legislation to establish a regulator for the pension sector. The speech left nobody in doubt that public sector disinvestment would be back on the agenda. The legislative bills to allow land acquisition for special economic zones and rehabilitation of displaced persons will be reintroduced.
