Setting the tone on a key issue of concern for India at the G20 summit, Prime Minister Manmohan Singh today pushed for an "orderly exit" from unconventional monetary policies being pursued by the developed world to avoid "damaging" growth prospects of the developing world.
With India hit by a declining value of rupee, widening Current Account Deficit (CAD) and stunted growth, the country's anxiety over imminent phasing out of the fiscal stimulus by US Federal Reserve was reflected by the Prime Minister on the eve of the eighth summit of the Group of industrialised and major emerging economies.
Singh arrived here this evening to participate in the two-day summit which is expected to focus on current market volatility and currency concerns in the emerging economies including the five-nation BRICS bloc.
Besides India, the other member countries are Brazil, Russia, China and South Africa.
"I will emphasise in St Petersburg the need for an orderly exit from the unconventional monetary policies being pursued by the developed world for the last few years so as to avoid damaging the growth prospects of the developing world," Singh said in a statement ahead of the summit.
He also underscored the importance of G20 to promote policy coordination among major economies in a manner that provides for a broad-based and sustained global economic recovery and growth.
The Prime Minister made a reference to orderly exit from unconventional monetary policies in the backdrop of splits between emerging markets and the US over its winding down of stimulus and the slowing growth of BRICS nations.
Singh said though there are encouraging signs of growth in industrialised countries, there is also a slowdown in emerging economies which are facing the adverse impact of significant capital outflow.
BRICS bloc seen as an alternative economic powerhouse, all go into the meeting after experiencing slowing growth, embattled currencies and huge capital outflows.
Economic Affairs Secretary Arvind Mayaram during a media interaction said there should be a measure of "predictability" on the Quantitative Easing (QE) by the US Federal Reserve so that the spillover does not disrupt the emerging economies.
The stimulus was introduced by the US in 2008 at the height of the financial crisis creating liquidity which helped the big emerging markets.
"There should be a measure of absolute predictability (on QE issue)," Mayaram said.
