India-China cooperation sought at G20 summit

April 1st, 2009 - 6:32 pm ICT by IANS  

By Dipankar De Sarkar
London, April 1 (IANS) The shadow of tough-talking Chinese looms over the Group of 20 (G20) summit of world leaders, but an informed Indian source dismissed suggestions Beijing was being confrontational.

“I don’t think the Chinese are taking a very confrontational stance on financial regulation or any of the substantive issues,” the source told IANS Wednesday.

In tandem, leading Indian-origin economist Lord Meghnad Desai urged India and China to cooperate at Thursday’s summit in order to resolve a growing dispute between China and the US over the financial crisis.

The summit is being held in the backdrop of some strong words coming from Beijing, particularly about US strategies.

China, the largest holder of US dollar-denominated assets in the world, is worried that its foreign reserves - worth two trillion dollars - could be hit if the US continues to print money with the risk of a fall in the dollar’s value.

Premier Wen Jiabao told reporters earlier this month: “We have lent a huge amount of money to the United States. Of course we are concerned about the safety of our assets.”

Alongside, China’s Central Bank Governor Zhou Xiaochuan has proposed a new international currency to replace the dollar, and the bank’s deputy governor Hu Xiaolian suggested a much closer global supervision of the US economy.

The statements have prompted some commentators to label the G20 summit as a G-2 summit of China and the US.

“This is really the G2, not the G20,” the international economist Meghnad Desai told IANS.

“India should support the Chinese economy. Unlike the Chinese, India has been very active in the IMF. This can be a great opportunity for India-China cooperation,” Desai added.

“India can mediate,” he said, adding: “It is thanks to globalisation that both India and China have emerged as important players.”

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