Finance Minister Nirmala Sitharaman pitches for global plan to aid post-Covid recovery

Finance minister Nirmala Sitharaman has called for a coordinated, global action plan to not just expedite post-pandemic recovery but also build resilience to future shocks.

Participating in the G20 Emerging Market Economies meeting in Washington, organised by the International Monetary Fund (IMF), the minister also flagged near-term policy challenges for emerging economies, including food and energy security and the tightening of global financial conditions, according to the finance ministry.

Reserve Bank of India (RBI) governor Shaktikanta Das, chief economic advisor Venkatraman Anantha Nageswaran and RBI deputy governor Michael Patra also attended the meeting.

Stating that the Russia-Ukraine conflict has set back worldwide economic recovery, the IMF on Tuesday trimmed its forecasts for Indian as well as global growth by 80 basis points (bps) each from its January projections. It reduced its FY23 India growth forecast to 8.2% and its global projection to 3.6% for 2022. It also scaled back its global trade growth projection by 100 bps for 2022 from an earlier forecast. It warned that even these forecasts were fraught with heightened uncertainties, with risks tilted to the downside.

“The Finance Minister, speaking on the need for #environmentally #sustainable and financially viable alternatives of energy sources, said that @isolaralliance can be an effective platform to catalyse efforts in this direction,” the finance ministry said in a tweet on Wednesday.

Sitharaman has been on a visit to the US from Monday to attend the spring meetings of the International Monetary Fund (IMF) and the World Bank.

She is taking part in the meetings of the finance ministers and central bank governors of the G20 nations.
The minister met Klaas Knot, chairman of the Switzerland-headquartered Financial Stability Board, an international body that monitors and exchanges views on “dimensions of risk in the crypto eco-system”.

Earlier this week, at a seminar during the ongoing spring meet of the IMF, Sitharaman flagged risks of cryptocurrencies being misused for money laundering and terror financing. Pitching for a global strategy around cryptocurrencies, she stressed that it was not possible for any one country to regulate them. She also called for harnessing technology to effectively regulate them.

FM focuses on climate change

Sitharaman met Mary Schapiro, vice-chairperson of the Climate Finance Leadership Initiative (CFLI) on Tuesday (Washington time) and discussed her vision of developing Gujarat-based GIFT City to draw global capital for sustainable finance.

CFLI typically “convenes leading companies to mobilise and scale private capital for climate solutions”, according to information on its website.

Schapiro informed the finance minister on the current status of flow of private capital into climate-related projects globally and in India from their CLFI experiences. Both also discussed the road ahead from regulatory perspective to attract global private capital into India.

Separately, Sitharaman also held a meeting with South Korea deputy prime minister and finance minister Hong Nam-ki. While discussing ways to bolster the India-Korea economic partnership, Sitharaman also appreciated the interest shown by South Korea in infrastructure development projects in India.