India asks World Bank to boost lending to developing worldApril 27th, 2009 - 12:10 am ICT by IANS
By Arun Kumar
Washington, April 26 (IANS) India Sunday proposed a three-point action plan, including a substantial increase in the World Bank’s lending, to enable the developing world to recover from the worst recession since the Great Depression.
“Emerging market economies were not the cause of this crisis, but they are amongst its worst affected victims,” Ashok Chawla, secretary of the department of economic affairs, told the Development Committee of the Bank.
“Recession has hit the export performance of developing countries and the choking of credit, combined with elevated risk perception, has led to lower capital flows and reduced levels of foreign direct investment,” said Chawla, representing Bangladesh, Bhutan, India and Sri Lanka.
To overcome the resultant slowdown “casting an ominous shadow on prospects for rapid economic growth, eradication of poverty and achieving Millennium Development Goals (MDG) in a reasonable time frame,” he said acting on the decisions taken by the G-20 leaders they must take action on three essential points of action.
These were: (i) a substantial increase in lending, (ii) a review of the Bank’s lending capacity and capital adequacy and (iii) enabling large developing countries to access required levels of finance through increased lending limits so that they can support recovery in their regions.
“All the three issues are important and we need to direct the Bank to start work on all fronts,” he said noting the lending needs of the developing world are enormous,” he said.
“To deliver on the promise $300 billion of lending over three years, the Bank would certainly need to lend more than the $100 billion it is currently targeting,” he added.
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