Prime Minister Manmohan Singh leaves for Seoul on Wednesday on a three-day visit to attend the G20 Summit, armed with a new plan to rebalance growth and deficit and strong support of India’s greater role in world affairs by the US.
Ahead of the visit, two issues have already strengthened India’s position at the high table — US President Barack Obama’s open support to New Delhi’s permanent seat on the UN Security Council and higher voting right at the International Monetary Fund (IMF).
Incidentally, Manmohan Singh will meet Obama again in Seoul in what will be his seventh interaction with the US president since he took office last January and the second in less than a week.
“India has already made a mark at global forums on climate change, trade talks. Now, its views will be taken more seriously at G20 as well,” said Amit Mitra, economist and secretary general of the Federation of Indian Chambers of Commerce and Industry (FICCI).
“From the remarks made by the US president and our prime minister, it is clear India is seen as the prime navigator and balancer that can traverse both worlds — that of the rich and the poor/emerging economies,” Mitra told IANS.
“The world recognises that India has three other advantages over economies of similar standing — a vibrant democracy, a demographic profile waiting to be unleashed and tapped, and an envious growth rate that has an appetite for more investment.”
What Mitra was also alluding to was Manmohan Singh’s remarks Monday that the world needed a new balance between deficit countries and surplus countries, referring to the US and China at the two ends of the spectrum shaking the currency markets.
“This group (G20) will, I sincerely hope, grapple with this issue of rebalancing growth by laying emphasis on faster growth in the countries which are described normally as developing world,” Manmohan Singh said.
“That balance has to be restored by paying more attention to development and the development potential, including infrastructure development and energy, infrastructure, and agricultural infrastructure in the poorer countries of the world.”
President Obama later endorsed this position in his address to a joint sitting of Indian parliament, also asking New Delhi to join Washington in ensuring global financial stability at the upcoming G20 Summit.
In fact, US Treasury Secretary Timothy Geithner said even the Chinese will be supportive of Manmohan Singh’s plan, since Beijing will see a lot of benefit from the proposal.
“I’m very confident that you’re going to see very strong consensus on this basic framework because it meets the basic tests and it’s better than the alternatives,” Geithner said Monday.
During the G20 Summit, Manmohan Singh is also scheduled to meet with his host, South Korean President Lee Myung—bak, officials said.
The two leaders last met in Hanoi Oct 29, on the margins of the India—ASEAN Summit, where they finalised two far-reaching bilateral pacts — one on civilian nuclear cooperation and another on comprehensive economic cooperation.
This time, Lee may rake up another issue with the Indian leader — the $12 billion integrated steel project proposed in India by South Korea’s Posco, which has run into rough weather over environment concerns.
Ahead of the Seoul visit, India secured a major say in global economic affairs with more weight for it, along with China, Brazil and Russia, on the executive board of the International Monetary Fund (IMF).
The reform, the most fundamental overhaul in the fund’s 65-year history, was approved Friday. It has also reduced the clout of European members, including Belgium and Germany, in the organisation.
India also expects the Seoul Summit to bring the Doha Round of global trade talks under the World Trade Organisation (WTO) back on track, and has already sought to bring key countries on board in this regard.
“Through the G20 summit in Seoul, a strong articulation of political intent would lend the necessary momentum to negotiations,” Indian Commerce Minister Anand Sharma said recently after meeting key negotiators in Geneva.
According to officials here, the prime minister’s schedule in Seoul includes a working dinner with the leaders Nov 11 to deliberate on the broad global economic framework, followed by discussions on seven issues including trade, financial regulation an climate change the next day.
The prime minister returns Nov 12.
Besides India and South Korea, the G20 comprises Argentina, Australia, Brazil, Canada, China, France, Germany, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, Turkey, Britain, the US and the European Union.