Countries such as Brazil, India, Indonesia and China are more likely to consider building alternative bodies to act as emergency lenders to troubled nations and as a global “truth teller” of economic realities, according to Raghuram Rajan, Governor, Reserve Bank of India.

In an interview with The Australian Financial Review , the Governor said: “There is only so long the world can wait for the US to get its act together (on IMF reform). We emerging markets have to step up to be part of the agenda setting, rather than (remain) passive when the agenda is set and then reacting to the agenda,” he said in a hotel conference room overlooking Sydney Harbour.

If the international fora are not responsive, both in terms of quotas but also in terms of hearing and allowing the agenda to be set by more emerging markets, there will be a drift away towards more regional groupings, which would be unfortunate, he said in the interview, which has been carried by the RBI website.

Supportive of business

Companies that have stayed the course in India are making money — more money than they are making elsewhere, saidRajan.

Urging Australian companies, which fear perceived corruption and heavy-handed Indian bureaucracy, to learn from the experiences of Western companies that have stayed the course, Rajan said “With risk comes return, and people have learnt how to make money in India.”

Many of India’s states are supportive to new businesses, the Governor said in the interview.

“If you look at companies that have spent a few years trying to figure out how do things — and I don’t mean that in a negative sense — how the system works; you can survive without being corrupt, without having to pay bribes and actually make a ton of money,” he said.

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