Finance Minister Nirmala Sithraman is hopeful of International Monetary Fund (IMF) providing higher resources for emerging and low-income countries to safeguard the global financial system. She also expressed optimism about India’s economy growing at 7 per cent during current fiscal.

“I believe the IMF needs to increase resources available for emerging and low-income countries to safeguard the global financial system. Therefore, concluding the 16th GRQ by December 15th, 2023 is vital for increasing the voting rights of emerging market economies (EMES) in line with their relative positions in the world economy,” she said while addressing Plenary Meeting of the International Monetary and Financial Committee (IMFC) at the International Monetary Fund Headquarters during the Annual Meetings 2022 in Washington DC on Friday (early Saturday in India).

The IMF’s Board of Governors conducts general reviews of quotas (GRQ) at regular intervals (no more than five years apart). Any changes in quotas must be approved by an 85 per cent majority of the total voting power, and a member’s own quota cannot be changed without its consent. the two main issues addressed in a general review of quotas are (i) the size of an overall quota increase and (ii) the distribution of the increase among the members. 

December time line is for 16th review. As part of the  Review, the BoG requested the Executive Board revisit the adequacy of quotas, and continue the process of IMF governance reform—including a new formula as a guide—and ensure the primary role of quotas in IMF resources. Any adjustment in quota shares would be expected to result in increases in the quota shares of dynamic economies in line with their relative positions in the world economy. That is, it would likely result in an increase in the share of emerging market and developing countries as a whole, while protecting the voice and representation of the poorest members.

Resilient economy

Meanwhile, Sitharaman said that despite global headwinds, Sitharaman said, Indian economy will stay on course and is projected to grow at 7 per cent in FY 2022-23. This is an outcome of the conducive domestic policy environment and Government’s focus on key structural reforms to boost growth, she added.

She emphasised the initiatives the Indian Government has taken to protect growth while pursuing inflation management. “We have ensured the availability of free food grains to more than 800 million vulnerable families for the past 25 months, through the country’s massive public distribution network,” she said.

Sitharaman said last mile delivery of financial services to the poor has been a key priority of the government and this has been aided by India’s digital public good infrastructure. , India is leading the world in terms of digital payments innovations with our transaction cost being the lowest in the world.

Meanwhile, the Finance Ministry has notified new wage structure for officers and employees of four general insurance companies. New structure will take into effect from August 01, 2017. Average increase in wage is around 12 per cent. However, the Ministry has made it clear that the next revision due from August 2022 will be in the form of a variable pay based on the performance of the company and the employee.