Looking for a twenty-twenty vision

The money the G-20 is spending will help India. So will the experience of setting new rules.

The G-20 summit in London set out to do two things: put more money into the global pot and take away lessons from a global classroom. On both counts India has come away richer. First the money. The $1.1 trillion the world is stumping up to free trade and capital flows across nations will mainly benefit the emerging markets. And here India is a frontline State.

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We don’t need any of the extra cash the IMF is getting to rescue embattled economies, but some of the $250 billion credit line for trade will find its way to our shores. It is heartening that the Indian position at the previous G-20 summit—global recovery is not possible without a lifeline for the developing world — topped this meeting’s actionable agenda.

Next, the lessons. India finds itself in working groups that will set new rules for containing risk in financial markets and the banking industry. The experience gained will be valuable in regulating our deepening financial market. Heightened accountability for credit rating agencies, for instance, should coincide with the evolution of a corporate bond market in India.

Not that all the experience need flow from mature economies. Since they started operating here, hedge funds have been required to register with the stock market regulator or operate as sub-accounts of foreign institutional investors, which has ensured a modicum of monitoring. The G-20 line on hedge funds is comfortingly close to what our central bank and government have maintained for years.