India today called for urgent revision of the quota of International Monetary Fund in favour of dynamic emerging market so as to reflect the ground realties of the world.
Union Finance Minister Arun Jaitley also expressed hope that this can be done as part of the 15th General Review of Quotas (GRQ).
Addressing the annual meetings of the International Monetary Fund and World Bank here, he said, "There is an urgent case for revising quota shares in favour of dynamic emerging market countries in line with global economic realities to maintain fairness in the governance structure of the Fund."
"We should make every effort to complete the 15th Review by the agreed timeline of 2019 Annual Meetings," he asserted.
In his address, Jaitley said the risks to global financial and economic stability have significant implications for IMF's operations, in terms of growing amplitude of financial crisis and owing to increasing vulnerability of the international monetary system (IMS) to emerging transitions and growing complexity of economic and financial linkages which could cause correlated financial crises/contagion – placing large demands on IMF resources.
The Fund needs to be adequately resourced to meet these demands while functioning as a strong quota-based institution.
Presently, the Fund's resource base is overly tilted towards borrowed resources and must be realigned appropriately in favour of quotas going forward, the Finance Minister said.
Similarly, for the World Bank Group, a delayed but unanimously agreed Lima Roadmap had envisaged to see a conclusion of the 2015 shareholding review by Annual Meetings 2017.
"While we note that we failed to deliver it, given the progress that has been made so far, we strongly urge all to commit to deliver an equitable conclusion of this process for both the IBRD and IFC by the Spring Meetings 2018. Any further delay in concluding the review will risk not only development in the client countries but the existence and leadership of both Bank and IFC in MDBs," he warned.
Jaitley said that delay in concluding the voice realignment is coupled with risks and delays to the critical agenda of capital increase.
The possibility of generating sufficient resources through the management levers has had only a marginal impact given the scale of capital requirement, and hence, early capital infusion into WBG is an imperative, he said.
"We look for an expeditious decision on capital enhancement through both selective capital increase (SCI) and general capital increase (GCI) for both the IBRD and IFC, by Spring Meetings 2018," said the Union Finance Minister.