India has asked the world''s rich countries, especially the US, to take measures
to cool down volatile financial markets and avoid the crisis from spreading to
Europe in 2008.
urge the advanced economies to take appropriate measures to restore full normalcy
in financial markets," finance minister P Chidambaram said at the joint meeting
of the World Bank and the International Monetary Fund.
last week said that while the developed countries had injected considerable amount
of liquidity into their markets, part of the liquidity had spilled over into India
and some other countries.
said the injection of funds have increased downside risks and the turbulance is
spreading across financial markets. The prospects for 2008 are somewhat uncertain
as risks continue to unfold, he added.
said global imbalances, supply-side inflationary pressures like oil prices and
protectionism continue to pose risks to growth.
China and India continue to remain the engines of global growth and the world
GDP growth is projected to cross 5 per cent this year, he said, supply-side inflationary
pressures and protectionism continue to pose risks to growth.
managing director Rodrigo Rato also warned that an ''earthquake'' in credit markets
sparked by rising defaults in the US mortgage market could tip the global economy
who steps down at the end of October, said the full scale of the financial turmoil,
which was sparked by rising defaults in the US mortgage market, could not yet
be gauged, but that it was large enough to raise a troubling question.
central question now is whether the global economy is at an inflection point,"
he said. "So far, it seems that growth will continue, although at a slower
pace than in the past two years."
IMF chief, speaking toward the close of a three-day annual meeting of the IMF
and World Bank, said the credit market strains that burst into view in August
had exposed weaknesses in the world''s financial infrastructure that needed to
he said corporate balance sheets in developed countries were strong and labour
markets generally healthy.
these reasons, we expect a slowdown in growth but not a recession in the United
States, and a smaller slowdown in other advanced countries," Rato said. He
added that emerging economies, led by fast-growing countries such as India and
China, had become a source of stability.