India on Saturday pitched for a step-up in financial resources of the Asian Development Bank (ADB) as a substantially expanded base would go a long way in helping developing countries speed up poverty alleviation programmes, promoting infrastructure development and expediting the process of reaching their growth potential.
“We now need to substantially expand the resource base of multilateral development banks so that they have the firepower to help developing countries reach their growth potential,” Prime Minister Manmohan said in his inaugural address at the 46th annual general meeting of the Manila-based multilateral lending agency at Greater Noida.
Asserting that it was essential to ensure that the level of ADB’s annual lending did not come down — as is being feared by the lending agency owing to inadequate returns on its capital — Dr. Singh suggested that the bank find innovative ways to channel global savings for development of infrastructure projects in developing countries. “…Expanding infrastructure financing and investment through the intermediation of the ADB could help lower the cost of financing long-term infrastructure projects.”
In this regard, he sought to showcase India as a point of call for such long-term private and foreign funding for infrastructure development, saying the government was taking steps to make it a more attractive investment destination so as to achieve a growth of over eight per cent during the 12th Plan period (2012-17).
Addressing delegates from 67 countries, including Finance Ministers and central bank governors, Dr. Singh assured prospective investors of the strong measures that were being taken to achieve fiscal consolidation and high economic growth, and outlined the various policy decisions in the pipeline to address structural bottlenecks.
Decline in lending level
In his opening address, Finance Minister P. Chidambaram, who is also Chairman of the ADB Board of Governors, said that as the level of lending by the Manila-based institution was projected to decline from $10.1 billion to $8 billion and in view of the financial constraint, “the support that the ADB can deliver for economic development and poverty reduction in the region will be seriously constrained by the lack of adequate capital. We may hit the wall in about three years.”