Poor will continue to bear impact of crisis: Mukherjee
Finance Minister Pranab Mukherjee said the adverse effects of the financial crisis will continue to hit the poor for several more years as many developmental programmes suffered serious setback during the crisis.business Updated: Oct 06, 2009 21:39 IST
Finance Minister Pranab Mukherjee on Tuesday said the adverse effects of the financial crisis will continue to hit the poor for several more years as many developmental programmes suffered serious setback during the crisis.
Speaking at the plenary session of the annual meeting of the World Bank and the International Monetary Fund (IMF), Mukherjee said: "The struggle to achieve the MDGs (millenium development goals set by the UN) has suffered a serious setback."
According to him, the demand for World Bank assistance would remain high for many years to come. "The Bank needs to be well capitalised to meet this demand."
Although development assistance rose to record levels in 2008, donors are falling short by $35 billion per year on the 2005 pledge on annual aid flows made by the the Group of Eight (G-8) countries in in Gleneagles, Scotland.
Reiterating the country's demand for enhanced voting rights of emerging economies like India in multilateral institutions, Mukherjee said: "Far reaching changes to the governance structure of the IFIs (international financial institutions) are needed to reflect the changing dynamics of the global economy."
"Role of developing countries as drivers of future global economic growth needs to be recognised. Resistance to the overdue change will only detract from the legitimacy, credibility and effectiveness of these institutions," he added.
Having committed $10 billion toward India's share in the additional capital of the IMF, Mukherjee said purchasing power parity must be the most relevant measure in deciding the voting rights in multilateral funding agencies.
For the $1.2-trillion Indian economy, the per capita income may still be low because of its huge population of 1.17 billion, but based on the purchasing power parity, it ranks among the top five emerging economies, he added.