India and other emerging economies are likely to press for greater representation in the International Monetary Fund and World Bank at the annual meeting of the global financial bodies this weekend, but the US is unlikely to bow to the demand without preconditions.
Ahead of the annual meeting of the IMF and World Bank here, a top US official indicated on Tuesday that greater representation of emerging economies in the bodies hinged upon their acceptance of greater accountability for the impact of their decisions on the global economy.
"We have said it's important for the voice and representation of emerging markets to be expanded on the board of the World Bank and more generally at the IMF in order to be better reflect the realities of the 21st century economy," a senior Treasury official said.
"So we're going to continue working hard with our partners to ensure that those shifts continue to make way for an emerging economy.
"But, we also have to make sure that as countries assume their seats at the table, they recognise that increasingly, because of their size and their weight on the global economy, their decisions matter to the global economy," the official said.
The official, however, indicated that the United States is hopeful the crucial IMF governance issue will make substantial progress ahead of the next G-20 summit in November.
"I think that this set of issues will be discussed this weekend. I don't know whether they'll actually get resolved this weekend. But there's other opportunities in the lead-up to Seoul to continue discussing these important issues,"
Finance Minister Pranab Mukherjee will represent India at the meetings, where he and officials from other emerging markets are expected to push for an early resolution to the contentious issue of IMF reforms to reflect contemporary realities.
At present, a country's voting power in the IMF is linked to its financial contributions and economic strength, besides other criteria, but countries like India, China, Turkey and Brazil are calling for a fundamental restructuring of the governance structure of the body.
"Last year, at Pittsburgh, the G-20 committed to increase the voice and vote of dynamic and emerging developing countries.
"These are of course the countries that are playing a greater role in the international monetary system and it is critical to expand their representation commensurate with their growing responsibilities in the system," the official said.
"We've been very clear that we want to see greater emerging market and developing country representation at the IMF Executive Board.
"We believe, and our G-20 partners have agreed, the fund must be representative of the 21st century global economy. And so we will look forward to moving forward on a package of reforms that will certainly be discussed this weekend, but may ultimately be resolved in the lead-up to Seoul," the Treasury official said.
