India on Wednesday pitched for increasing the voting power of emerging economies in the International Monetary Fund (IMF) by 5-6 per cent, which would give developing countries a greater say in how the 186-nation Fund was run.
“Quota reforms in IMF is one of our basic objectives... we want that at least 5 to 6 per cent quota should be increased in IMF and emerging market economies of the world should have their shares,” Finance Minister Pranab Mukherjee said.
In April, India wrested greater say in the affairs of World Bank when member nations approved a shift in voting rights. This saw India’s voting rights increase to 2.91 per cent from 2.77 per cent — making it the seventh-largest member.
“This is one of the subjects that will emerge in the course of my discussions with the authorities of the World Bank and IMF,” he added.
Mukherjee will raise the matter at the annual meeting of IMF and the World Bank, which kicks off in Washington today.
Once their voting powers are increased, developing nations would be able to influence how and where the funds are deployed, such as fighting poverty and fostering development.
The Brussels Declaration on more effective global economic governance, adopted at the conclusion of the eighth Asia-Europe Meeting, said IMF quota shares should be shifted to dynamic emerging markets and developing countries by at least five per cent from over-represented to under-represented countries.
Like the United Nations’ Security Council, which is criticised for reflecting the political power structure that existed after the Second World War, IMF is said to reflect the economic dynamics of the same era.
He pointed out that the developing countries were making a substantial contribution in the world’s output and GDP and “according to us, the quota and governance structures of IMF do not reflect the ground realities”.
Underling the urgent need for reform, Mukherjee said global economic realities “should get reflected in the share in the quota and governance architecture of the world’s financial institutions”.
Mukherjee also plans to raise this issue again at the meeting of finance ministers from the G-20 countries in South Korea, later this week.
