RBI Governor Shaktikanta Das calls for expeditious completion of IMF quota review

RBI Governor Shaktikanta Das calls for expeditious completion of 16th IMF quota review to help distressed countries. He notes IMF funding conditions come with riders and stigmas, causing countries to seek support elsewhere. He suggests programmes with less conditionalities for countries with resilient macro-fundamentals.

Reserve Bank Governor Shaktikanta Das on August 11 pitched for the "expeditious completion" of the 16th general review of the quotas at the International Monetary Fund (IMF), pointing out that the same can help the multilateral lender assist distressed countries in a better way.

Addressing a G20 seminar on the global economy, organised by the Finance Ministry and the Reserve Bank of India (RBI) here, Das also said the funding conditions of the IMF are such that they make the country that needs the money urgently look elsewhere because those conditions come with lots of riders and attendant stigmas.

“My point is that corrective measures, including financing, should be put in place in a timely, non-stigmatised and more open access basis. For this, a bigger and stronger IMF that is capable of managing the levels of country-risk assumes crucial importance.

“This is more so since the IMF’s support is linked to the quota size of the member-countries, the 16th general review of the quotas and its attendant requirements, including governance reforms, need to be completed expeditiously,” Mr. Das said.

He also said that recent experiences suggest poor countries facing financial difficulties go to other bodies beyond the IMF because of the perceived stigma or lack of access.

Therefore, "a bigger and stronger IMF that is capable of managing the levels of country risks assumes crucial importance," he noted.

According to him, the crucial role of the IMF and the World Bank in addressing global debt vulnerabilities cannot be overstated as they are at the centre of international monetary and financial system.