labels: economy - general, international monetary fund
IMF dangles quota hopes before India as Fund-Bank meet comes to a closenews
20 September 2006

Mumbai: The International Monetary Fund (IMF) has promised to extend quota reforms to the second stage of reforms that would open up the possibility of additional voting rights for India.

The voting for increased quotas for China, Mexico, Turkey and South Korea was "not the end of our reforms on quotas, but the beginning of a process that will continue during the next year," said IMF managing director Rodrigo De Rato.

The voting for an ad-hoc revision of quotas for the four emerging economies went 90.6 per cent in favour of the four countries. This had left India with a depleted quota of 1.91 per cent against the earlier 1.95 per cent - approximately half of China's quota.

Rato said the second stage of reforms would involve broader adjustments for more emerging economies and increased voting rights for poorer members in the IMF.

Finance minister P Chidambaram had termed the new quota formula, which increased quotas for only a select few emerging economies, as flawed. However, he said, India would cooperate with IMF in the second stage of reforms, which he said should start right now.

Before leaving for South Korea, he also reminded those who voted for the resolution of their promise that the second stage of reforms will also be carried out.

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IMF dangles quota hopes before India as Fund-Bank meet comes to a close