World Bank, IMF chiefs to visit India later this month

Heads of the two most powerful banking institutions globally, the World Bank and the IMF, are likely to be in India later this month, amid an ongoing search process to finalise the name of the next World Bank President.

During their separate visits, the World Bank President Robert Zoellick and IMF Chief Christine Lagarde are likely to meet top leaders and policymakers in New Delhi and discuss the various economic policies and reforms being undertaken by India, given its growing influence in the global economic arena.

The IMF (International Monetary Fund) has said that Lagarde would be here on March 19-20, although there is no official word so far on Zoellick's India visit.

A person in the know of the development, however, said that Zoellick was likely to come to India in the last week of March and his itinerary was being finalised.

These high-profile visits assume significance in the wake of demands from emerging economies that chiefs of these two influential multi-lateral lending agencies should be selected on the basis of merit, and not their nationality.

Zoellick is stepping down as the World Bank President in June and a search process is on to finalise his successor.

Since their inception, the World Bank and the IMF have always been headed by persons from the US and Europe, respectively, although there are no rules barring those from other countries being appointed to these positions.

The US and Europe account for a major chunk of voting rights at these institutions, but the voice has been getting louder for a greater importance to the emerging markets.

Against the backdrop of financial meltdown that saw economic clout slowly shift away from the West, India and other emerging economies have been pitching bigger voice in the IMF and World Bank to reflect the contemporary realities.

The names currently doing the rounds as serious contenders for the post of World Bank President are mostly Americans, although some names have been suggested of persons from other countries as well.

The probable names include renowned economists Jeffrey Sachs and Larry Summers and the US Treasury Secretary Timothy Geithner.

Initially, the name of the US Secretary of State Hillary Clinton was doing the rounds, but her office later denied her name being in the contention.

Those in the contention also include global investment firm Pimco's chief Mohamed El-Erian and Bangladesh's Nobel laureate Mohammad Yunus, while reports have also named two powerful Indian-origin American citizens, Citigroup's Vikram Pandit and PepsiCo's Indra Nooyi, as potential candidates.

Some blogs and social networking sites have also thrown forward Indian names like technocrat Nandan Nilekani, union minister Jairam Ramesh and Planning Commission Deputy Chairman Montek Singh Ahluwalia.

In a reflection of their rising clout, the BRICS bloc of emerging economies (Brazil, Russia, India, China and South Africa) have said that the post of World Bank chief should be merit-based and open for all countries.

India, and also many other emerging nations, had taken a similar stance during the selection of IMF chief last year, before agreeing to the candidature of Lagarde.

External Affairs Minister S M Krisha also said last Friday that "if in the past, US had representatives as head of the World Bank, it is now necessary for other countries to come out with suitable names of candidates who have the wisdom and merit to hold the post."

The deadline to submit nominations for the post of World Bank chief is 23rd March, after which probable candidates would be short-listed to decide on the final name.

Even though, India has over three times the population of the US, its voting rights at the two multilateral agencies is less than one-third of that of the world's largest economy.

India has a voting share of 2.91 per cent and 2.34 per cent at the World Bank and the IMF, respectively.

At the World Bank, the US has a voting right of about 15.85 per cent while it is around 16.75 per cent at the IMF.

The IMF is also looking to boost its funds in order to play a larger role in stabilising the global economy battling European debt turmoil.

The additional money for the multilateral lender is expected to come mainly from emerging powers such as China, India and Brazil.

During her visit to India, probably the first since she became IMF Managing Director, Lagarde would be participating in a conference on 'China and IndiaSustaining High Quality Growth' in New Delhi on March 19-20.

Prior to her India visit, Lagarde would be in China on March 17-18.

The IMF chief would also participate in a round table discussion on 'Ensuring Strong Growth in the Post-Crisis Global Economy' scheduled for 20th March in New Delhi.

The visit is part of an ongoing engagement between the IMF and Asia and one of a series of high-level events in the region ahead of the IMF-World Bank Annual Meetings to be held in Japan later this year.