Finance minister Nirmala Sitharaman stresses on timely completion of IMF quota review

Finance minister Nirmala Sitharaman on Wednesday underlined the need for timely conclusion of 16th General Review of Quotas (GRQ) to provide greater say to developing economies in the International Monetary Fund.

As per an IMF resolution, the 16th General Review of Quotas should be concluded by December 15, 2023. Any adjustment in quota shares would be expected to result in an increase in the voting rights of emerging countries in line with their relative positions in the world economy.

Sitharaman made the comments during her meeting with MD of IMF Kristalina Georgieva who is visiting the country to discuss India's upcoming G20 presidency and IMF's support to India for the presidency.

"FM Smt. @nsitharaman emphasised the importance of timely conclusion of 16th General Review of Quotas GRQ) in a way that addresses inequity and imbalances in the global economy," the finance minister said in a series of tweets.

Georgieva agreed with Sitharaman that for the IMF to remain relevant, it is important that a consensus on GRQ be reached to reflect changed status of Emerging Market Economies (EMEs) in the world order, it said.

India's quota in the IMF, which determines voting shares in the multi-lateral lending agency, is 2.75 per cent. China's quota is 6.4 per cent and that of the US is 17.43 per cent.

A general review allows the IMF to assess the adequacy of quotas in relation to both the members' balance of payments in financing needs and the Fund's ability to help meet those needs.

During the meeting, Georgieva said that despite the global uncertainty and headwinds, India continues to be a bright spot in the global economy, the ministry said.

Sitharaman and Georgieva also discussed the significance of regulation of crypto assets and the need to have a globally coordinated, synchronised approach on the issue.

The finance minister urged that the IMF should play a lead role in this regard.

The two leaders also acknowledged that the effect of increase in global inflation due to rise in food and energy prices and international debt has impacted low-income countries the most.

Sitharaman underlined the need to ensure energy security for all.

"FM Smt. @nsitharaman reiterated the importance of coordinated policy measures & multilateralism for mobilising adequate financial resources for climate action, emphasising that committed funds by the developed economies is yet to become available," the ministry said.

Sitharaman further stated that carbon pricing may not a feasible policy tool for climate action.

India will hold the presidency of the G20 from December 1 to November 30, 2023. The country will host the G20 summit next year.