India confident of getting IMF quota reforms done by Jan 2013

The quota reforms of the International Fund (IMF) to give greater say to the developing countries in the working of the multi-lateral lending institution is likely to be completed by January 2013, said Indian Finance Minister P Chidambaram.

“We might not meet the timeline … I am confident that we will be able to get (IMF quota) reform done…what is important is we must get the reform done by January 2013 so that it becomes the basis of the 15th general review of quota to be completed by not later than January 2014”, the Minister, who is also the chair of the G-24 grouping of developing countries, said.

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The timeline of the 2010 IMF quota and governance reforms will be over in a few days, he said, adding “the managing director of IMF told us that governance reform requires 90 percent which is the required majority and we are almost there…the impression I get is, we are almost there. And hopefully we will be there”.

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The Minister further said that “we are already in October. There is not too much time and we would expect the US and other countries to address themselves and complete this reform by January 2013”.

Earlier, a G-24 communique said, “We note with concern that the 2010 IMF quota and governance reforms did not achieve the required voting power majority for approval by the deadline set of the Annual Meetings of October 2012. This can result in serious reputational risk for the Fund.

“We stress that the efforts to strengthen the IMF’s lending capacity must not undermine its character as a quota-based institution and must be anchored in a firm commitment to governance reform”, it added.

Once the quota reforms are carried out, India’s share at IMF is set to rise to 2.75 percent from 2.44 percent, making it the eighth largest shareholder in the multilateral agency from its present 11th position. In June 2012, Indian Prime Minister Manmohan Singh had announced that India would contribute $10 billion to the IMF’s $430 billion bailout fund for the eurozone.

India’s contribution was part of a pledge by the G20 nations made in April to supply the IMF with extra firepower.

PTI