Saturday, December 5, 2009

The world banks on India: Robert Zoellick

Robert Zoellick has seen a lot change over the course of a long career, first in the US government, now as the World Bank president.
World Bank But perhaps the most startling change is in the way the world views India.

‘‘The outside world’s image of India now is of cutting-edge competitive companies that are going to take jobs away from the developed world. I get more and more voices coming from Europe and North America saying, ‘Why should we give money to India when they’re going to be a threat to our businesses?’ I have to constantly explain the huge income diversity of India and the fact that a lot of development work still needs to be done,’’ he chuckles.

In an exclusive interview to TOI, Zoellick also dwelt on how the growing strength of India-US ties has proved helpful to him. “I’m eventually going to have to go to the US Congress to seek its support for an increase in the World Bank’s capital. I spoke to the Confederation of Indian Industry and said, ‘Maybe you can help me because I know there’s a strong India Caucus in Washington. Together we can make a case that an increase in the Bank’s capital would help India’s development’.”

Wrapping up a four-day visit to the country, Zoellick praised India’s “strong crisis management” and said it was playing an important role in leading a global recovery. “We all look to India now as a rising global economic power and in our interconnected world it has played a helpful role over the tough moments of the past year,” he said.
But he brushed aside a suggestion that the strong showing of the Indian and Chinese economies — at a time when the US and other developed countries are still struggling — might decisively shift the balance of power and make this the Asian Century.

‘‘Two centuries ago, India and China probably accounted for 20-25% of the world’s GDP each. For a variety of reasons, their share dropped dramatically thereafter. It’s natural that their share will increase again. But I personally think that the US retains a huge amount of dynamism and it’s not going away anywhere. When I visit India and China, I find a lot of people wanting to deepen their ties with the US. There has been a greater distribution of growth and opportunity in recent times, which is great. But I don’t see it as the Asian Century or the American Century or the European Century. I see it as the challenge of how to get the globalization process to work more effectively for everyone.”

Speaking specifically about the Bank’s role in India, Zoellick said he favoured a shift in strategy to get “more bang for the buck”. “Our current portfolio of commitments is $22 billion. That includes $3.4 billion a year from the International Finance Corporation (the Bank’s private sector arm). India is the primary country for IFC, we have more investments here than anywhere else.

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