World Bank President James Wolfensohn has commended India for the 'very good progress' it has made in its GDP growth.

"In countries adjacent to India too there is evidence now of an improvement," he said at a press conference in Washington.

"The process has been slow, but, nonetheless, I think that with education and health programmes, improved governance and increased trade, you can project that you will have a betterment of life in South Asia, and there is evidence that it is coming through," he added.

Wolfensohn said while the media were focusing on Iraq war, the Bank cannot afford to forget the millennium development goals, specially in education, health, water and sanitation, not to mention the war on poverty.

"Poverty is an ever present issue and the one we are seeking to address. We have had success in some parts of the world, particularly in East Asia and some parts of South Asia," he remarked.

He reminded developed nations of the goal they had set for themselves years ago, namely providing 0.7 per cent of their GDP for official development assistance.

"That would provide $160-170 billion a year. Against that goal, currently they are providing $52 billion for official development assistance while spending $350 billion on agricultural subsidies and $1,000 billion on defence," Wolfensohn added.

Horst Kohler, managing director of International Monetary Fund, meanwhile, referred to the importance of strengthening the development agenda as the most appropriate antidote to the risk of fragmentation among nations.

"The implementation of the Monetary Consensus, which combines self-responsibility in low-income countries with more comprehensive support from the international community needs to be boosted," he said at another press conference.

He commended a proposal by chairman of IMF's International and Monetary and Financial Committee and Britain's Chancellor of Exchequer Gordon Brown, for increasing financing for poor nations through an International Financing Facility.

Kohler said it as "an intelligent way to leverage scarce public resources and tap vast potential of international capital markets."

Under the Brown proposal, funds provided by the governments for development would be leveraged to increase amounts available by tapping capital markets, he said.

In the Poverty Reduction Strategy Process, "we have a promising vehicle in the fight against poverty by bringing together developing countries, international financial institutions, bilateral donors and civil societies in a joint effort for development," he added.

Kohler said the IMF has conducted a detailed analysis of the economic effect on the 184 member countries of the fund.

"Many countries have strengthened their economic fundamentals in recent years and are now better equipped to handle external shocks. IMF's financial position -- evidenced by a one-year forward commitment capacity of over $80 billion is strong," he said.

"Our existing facilities and instruments are sufficiently flexible to deal with the most conceivable eventualities," he added.