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India yet to decide on $11-bn loan to IMF

Source: PTI
Last updated on: April 09, 2009 18:53 IST
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If India takes part in $500-billion resource raising programme of International Monetary Fund, as decided at the G-20 summit in London last week, it will cost the country up to $11 billion (Rs 55,000 crore).

"If the government decides to participate in the new arrangements to borrow, then based on the quota, that ($11 billion) could be the amount which the country will have to commit in principle to IMF," Economic Affairs Secretary Ashok Chawla said on Thursday.

However, Chawla did not elaborate as to when the decision on the issue would be taken.

Leaders of 20 advanced and developing countries decided to treble the resources of IMF from $250 billion to $750 billion, so that the multilateral institution could help the poor and developing economies, which have been hit by the global credit crisis.

India has already said that it would not require any IMF support in the wake of comfortable foreign exchange reserves of about $250 billion.

However, New Delhi has not so far made any commitment towards contributing to the fresh resources of IMF, as was done by China, European Union and Japan.

On the issue of review of quota and increased representation in the multilateral agency, India still has time to decide on the strategy.

"The review of quotas or the rebalancing of quotas is not immediately on the table in the sense that no decision has yet been taken on that," said Chawla, who was part of the Indian team at G-20 summit.

An official communique issued at the end of the G-20 summit had recognised the importance of reforming international financial institutions to ensure they can assist members effectively and that emerging, developing and poor economies must have greater voice and representation.

"What we are looking for is going to be discussed and finalised over a period of time, which is, according to the communique, up to January 2011," the finance ministry official said.

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