Montek Singh Ahluwalia hopes G20 summit boosts confidence in global economic situation

November 15th, 2008 - 3:09 pm ICT by ANI  

Manmohan Singh

By Ravinder Singh Robin

Washington, Nov 15 (ANI): Planning Commission Deputy Chairman Montek Singh Ahluwalia has expressed the hope that the G20 summit on the global economy and financial markets would end with a communique that makes a strong statement of support for fiscal stimulus actions that would boost confidence in the global economic situation

He said that most important thing to counter is the recessionary tendencies and there should be coordinated efforts by all nations.

“The reference here to coordination is to coordination across countries. I mean the basic idea is if you are in an individual country, and you resort to a fiscal stimulus, there is always a fear that it wont actually lead to an increase in your own production because it will all leak out into imports but if you know that all your major trading partners are also doing fiscal expansion, then you will benefit from exports to those countries and that’’s where the coordination makes the intervention more effective and therefore overcomes resistances to following this approach,” he added.

He further said to minimize the adverse impact of the global meltdown and the financial crisis, countries need to adopt contra-cyclical policies.

Meanwhile, U.S. President George W. Bush on Friday hosted G-20 leaders for a White House dinner ahead of meeting.

Countering criticism that free-wheeling U.S-style capitalism is to blame for the crisis, Bush called upon leaders to work to fix the free-enterprise system, not dismantle it.

Despite underlying tensions over the summit’’s objectives, Bush was all smiles as he welcomed arriving world leaders including Prime Minister Dr. Manmohan Singh.

The Group of 20 includes Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the United Kingdom and the United States. The European Union is also a member, represented by the rotating council presidency and the European Central Bank. (ANI)

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