India will ensure to minimise global economic crisis: PM

New Delhi: Ahead of beginning his visit to Washington on Thursday, Prime Minister Manmohan Singh expressed concern over the likely slowdown in the growth of developing countries due to the global financial meltdown and called for strengthening global financial institutions to avert such a crisis.

The Prime Minister underlined that India's efforts at the G20 conclave will be to ensure that the fallout of the global financial crisis on developing countries will be “minimal”.

“Our message to G20 will be that they will do everything in their power so that the implementation of millennium development goals by developing countries will not be affected,” Manmohan Singh told reporters when asked how the global financial crisis will affect developing countries of the region.

He was speaking at a joint press conference with leaders of other member-countries of the Bay of Bengal Initiative of Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) - a regional grouping comprising India, Bangladesh, Sri Lanka, Bhutan, Nepal, Myanmar and Thailand.

Manmohan Singh will leave on a three-day visit to Washington on Thursday evening to attend the G20 conclave called by President George W Bush to discuss with leaders of developing countries how to address the global financial meltdown and reforms that could avert such crises in future.

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“International financial institutions such as the IMF and World Bank and regional development banks should be strengthened so that the fallout of the global financial crisis on developing countries in minimal,” he said.

Though it originated in the US and Europe, we are affected but relatively less than the banking and financial sectors of developed countries, he said. He underlined that the banks of developing countries in the region are better regulated and have healthy cash reserve ratios that could protect them from the meltdown.

“There is no threat to the financial health of region,” he said.

He, however, expressed concerns over the long-range effects of the ongoing meltdown.

“The growth rate in these countries is likely to be affected. That will affect exports of developing countries,” Manmohan said.

International financial institutions are reluctant to lend and there may be difficulties in balance of payment for least developed countries, he added.

If the flow of funds from developed to developing countries is affected, it will affect the capacity of developing countries to implement the Millennium Development Goals, the PM said.