India today told the G-20 nations, particularly the rich members, that it is not responsible for creating global imbalances and volatility in the international markets.
“The position of India is, it did not (and does not) contribute either to the buildup, or to the persistence of global imbalances.
"Nor does it contribute to the volatility that we have been witnessing in several of the international markets, including commodity markets,” Finance Minister Pranab Mukherjee said.
The minister said this during his intervention at the BRICS meeting and the first session of the G-20 Finance Ministers meeting here.
According to latest estimates, the Indian economy will grow by 8.6 per cent in 2010-11 and that the Indian growth story remains robust.
Mukherjee said a large emerging economy like India is vulnerable to seasonal factors and their effect on the food prices.
“As a result of vagaries of weather, India has witnessed a high and unsustainable inflation on the food items…” Mukherjee said, adding the food inflation has also been accentuated by structural changes in the consumption pattern due to the growth of the economy.
"Such high food inflation has a tendency to feed into general inflation throwing challenges at our macroeconomic management.
"The high and persisting international prices of food commodities do not give us room for comfort in tackling food inflation in India”, Mukherjee said.
The issue of fixing a set of parameteres like current account deficit, to check global imbalances are being widely debated here.
Mukherjee said India has been fortunate that the current phase of growth has been more or less evenly balanced between consumption and investment on the one hand, and between domestic demand and external demand on the other.
However, the country has its own “share of concerns arising from elevated commodity and asset prices, and economic problems of a more structural nature that underlie the uncertainties in the global economy”.
Some of these uncertainties also derive from the aggressive macro-economic policy response to the global crisis itself, he said.
Federal Reserve chief Ben Bernanke had yesterday blamed emerging economies for fueling the global commodity prices.
