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China pitches for new financial order

Source: PTI
March 04, 2009 15:53 IST
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China on Wednesday strongly pitched for reform of global financial institutions and establishment of a new financial order with Beijing and New Delhi playing a greater role in the decision-making process of these bodies.

Chinese Ambassador Zhang Yan said both the countries should work together to press the developed countries to bear their responsibility and prevent them from shifting the burden on to developing countries.

He said India and China should enhance cooperation in the economic field and join hands in ensuring reform of the international financial system to meet challenges posed by the economic downturn.

"China and India should strengthen cooperation and coordination in the reform of the international financial system and accelerate the establishment of a new international financial order," Yan said addressing a conference organised by the Confederation of Indian Industry in New Delhi.

"At the same time, we shall push for reform of the existing international financial institutions with a view to increase the role of China and India in decision-making process and empower them with greater say and representation in the international financial institutions," he said.

Observing that the two economic powers should "go hand in hand" and enhance bilateral cooperation in the economic field, Yan said such a move will send out a positive message and help the world economy to a great extent.

"We must beef up our confidence. At the time of crisis, confidence is crucial for fighting against the crisis and achieving early recovery," Yan said.

"When China and India, the two largest developing countries, run their affairs well, it can help restore confidence in global economic growth and curb spread of the international financial crisis,"  he said.

Noting that both the countries must take effective measures to tackle the crisis, he said it would help restore confidence in global economic growth and curb the spread of the international financial crisis.

"China and India's economies have both the strength and resilience against the crisis. We have huge domestic markets, sufficient financial resources and opportunities for investment, the Chinese Ambassador said.

He also said governments India and China have taken "decisive actions" by putting in place a series of stimulus packages with specific steps to counter the negative impact of the slowdown on the economies of the two countries.

"Both countries should exchange experience and draw inspirations from each other with a view to achieve better results."

Expressing confidence that the two countries will be able to emerge as winners from the crisis, Yan said both India and China should turn the crisis into opportunity.

"As long as China and India can join their efforts, learn from each other and compliment each other, the two countries will surely emerge as winners of this crisis," he said.

While talking about steps taken by China to protect interest of the underprivileged people, Yan also mentioned India's effort to ensure inclusive growth for its population.

Addressing the conference, secretary (economic relations) in the ministry of external affairs, H S Puri said both India and China have a crucial role to play in addressing the 'systemic risks' in the global financial system.

"A frank exchange of views between India and China on how both sides can cooperate to stabilise and re-launch the global economy would be a good beginning in this direction," Puri said.

He said that the new forms of international institutions are vital to tackle problems in future and that World Bank and IMF have to change the current form of their operations.

Puri said over the past five years, India has witnessed high growth rate of 8.8 per cent driven by strong industry and services sector performances as well as high savings and investment. "Despite the economic downturn, we expect India's GDP growth for the current year ending March 2009 to remain over seven per cent."

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