india-news

BRICS nations call for orderly stimulus withdrawal

By Arvind Padmanabhan, St. Petersburg, Sep 5 : Endorsing India's stand and hours before the official opening of the G20 Summit here, the BRICS nations Thursday called for an orderly exit of unconventional monetary policies like fiscal stimulus instituted by rich nations, as they had already hurt emerging economies hard and had the potential to damage their growth prospects further.


The leadership of the five emerging economies -- Brazil, Russia, India, China and South Africa, collectively called the BRICS nations -- also expressed satisfaction over the good progress made towards the establishment of the BRICS-led New Development Bank (NDB) and the contingent reserve arrangement (CRA).

"On the CRA, consensus has been achieved on many key aspects and operational details regarding its establishment. As agreed in Durban, the CRA will have an initial size of USD 100 billion," said an official communique issued by the Indian side, which is being led by Prime Minister Manmohan Singh.

The other leaders at the meeting were Brazil's Dilma Rousseff, Russia's Vladimir Putin, China's Xi Jinping and South Africa's Jacob Zuma.

"As agreed in Durban, the CRA will have an initial size of USUSD 100 billion. Country's individual commitments to the CRA will be as follows: China: USD 41 billion, Brazil, India, and Russia: USD 18 billion each, and South Africa: USD 5 billion," the communique added.

The fund is intended to help emerging economies and poor nations in easing their short-term liquidity pressures and keeping their financial stability.

Briefing journalists later, Foreign Secretary Sujatha Singh said while concerns were expressed in the passing about the situation in West Asia, the issue of Syria specifically was not raised by BRICS leaders.

"PM at BRICS- There are persisting challenges for the global economy and various political turbulances, especially in West Asia," said a tweet posted by Prime Minister's Office.

In light of the increase in the volatility in financial market and capital flows during recent months, the leaders again expressed their concerns over the "unintended negative spillovers of unconventional monetary policies" of certain developed economies.

"They emphasized that the eventual normalization of monetary policies needs to be effectively and carefully calibrated and clearly communicated," the communique said.

The Indian prime minister has maintained that rich nations, which are showing signs of recovery, must not pursue policies that hurt the developing world and that the collective focus of all must be on job creation and investment promotion in a bid to spur growth and sustain it.

"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 outflows," he had said in a statement ahead of the summit.

"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," he added.

During their meeting, the leaders of the five BRICS nations also noted with concern the continued slow pace of the recovery, high unemployment, and the on-going challenges and vulnerabilities in the global economy, particularly in advanced economies.

They felt major economies, including G20, could do more to boost global demand and market confidence.

On the proposed BRICS bank, the communique said progress has been made in negotiating its capital structure, membership, shareholding and governance. The bank, it added, will have an initial subscribed capital of USD 50 billion from the five BRICS countries.

"In light of the progress achieved both in the negotiations of the NDB and CRA, the BRICS leaders expect tangible results by the time of the next summit."

--IANS (Posted on 05-09-2013)

india-news headlines

Supreme Court reserves order on Subrata Roy's plea against judicial custody, new offer

Tejpal pleads for bail, Supreme Court issues notice to Goa

CBI files closure report in two coal scam cases

AAP wants Togadia arrested for hate speech; BJP, RSS defend him

India to host World Bridge Meet

Himachal public service panel studying UPSC exam pattern

Kashmir observes shutdown over separatist detentions

Roy bail: Sahara makes new proposal

BJP, RSS defend Togadia

Rahul to hold rallies in three states Tuesday

Opponents plan to slice up Modi's Varanasi pie (Election Special)

Everyone claims credit for AMU in Muslim-majority Kishanganj (Election Special)

Quick Links: Goa | Munnar | Pondicherry | Free Yearly Horoscope '2014

Comments

Your e-mail:


Your Full Name:


Type verification image:
verification image, type it in the box

Message:

Back to Top