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G-20 meet: World economy is in deep trouble

June 18, 2012 19:56 IST
Setting the tone for the crucial G-20 Summit, Prime Minister Manmohan Singh on Monday said the world economy is in "deep trouble" and hoped the grouping of developed and developing countries will come up with constructive proposals to pull the world out of this crisis.

With anxiety over the global economic woes being reflected at the seventh summit of the four-year-old grouping, Singh's suggestion that the G-20 should focus on the need on investment in infrastructure as a means of stimulating global growth was significantly well received at the deliberations.

"The world is in deep trouble, I hope the G-20 will come up with constructive proposals to get the world out of this crisis," Singh told newsmen ahead of the summit at this

Mexican coastal resort town, meeting against the backdrop of a faltering global economy and the burgeoning Eurozone crisis.

The economist-politician is set to take a leading role at the two-day summit of the G-20 coming up with solutions to fix the financial crisis in the 17-nation Eurozone. The G-20 accounts for 80 per cent of the global GDP.

US President Barack Obama last week in a telephone conversation with the Prime Minister said he is eagerly looking forward to meeting him at the G-20 summit and work for the successful completion of the parleys and evolve a coordinated response for the grouping to find swift solutions to the Eurozone crisis.

Singh has attended all the previous six summits of the G-20 which was launched in Washington in 2008. A possibility of a pull aside meeting between Obama and Singh here is not being ruled out by Indian officials.

Global economic woes triggered by the Eurozone crisis is threatening to affect several countries including India which has already made it clear that the European nations will have to come up with swift solutions before India is trapped in the contagion effect.

Noting that G-20 is a premier group dealing with international economic cooperation, Singh and other world leaders hope to evolve a coordinated response for the grouping to deal with the Eurozone crisis and hope for positive signals from European leaders like German Chancellor Angela Merkel and French President Francois Hollande.

Ahead of the Summit, Planning Commission Deputy Chairman Montek Singh Ahluwalia said the Prime Minister's suggestion that givingĀ  priority to investment in infrastructure as a means of stimulating global growth was finding "resonance" at the G-20 meetings.

Addressing issues relating to Indian economy, Ahluwalia said economic woes before the country have not gone out of hand in the wake of the slip in the GDP growth -- the lowest in nearly 9 years -- but there could be trouble if the Eurozone crisis is not quickly contained and financial stability in Europe restored.

Ahluwalia, who is the designated sherpa for India assisting Prime Minister Singh, said India will be "lucky" if it can achieve around seven per cent growth rate this fiscal.

The country's economic growth rate slipped to 5.3 per cent in the fourth quarter of 2011-12, lowest in nearly 9 years due to poor performance of the manufacturing and farm sectors.

G Sudhakar Nair in Los Cabos (Mexico)