Finance Minister Sitharaman calls for critical reforms of multilateral development banks

New Delhi: India on Saturday defended reform in multilateral development banks (MDB) to enable them to mobilize additional funds to help developing countries meet their development needs and address global challenges. “It is essential that financing requests made to the MDBs are met quickly and expeditiously. This will require reforms both at the operational level and to identify new sources of financing,” said the Finance Minister. Nirmala Sitharaman He said in his speech at the third Voice of Global South The summit was hosted virtually by India. He said that fresh capital injection should remain an active option for the boards of multilateral development banks to consider.

Sitharaman also called for measures to streamline the balance sheet and make financial innovations.

“When it comes to mobilizing private capital, multilateral development banks should collaborate with credit rating agencies and explore how to better incentivize the flow of private capital for development financing,” he said. G20 During India’s presidency, an Independent Expert Group headed by 15th Finance Commission Chairman NK Singh and former US Treasury Secretary Larry Summers was set up to suggest reforms to multilateral development banks.

Sitharaman expressed concern about inadequate access to development finance, which is preventing developing economies from achieving their development goals. Recent reports showed that the implementation of many sustainable development goals (SDGs) in developing economies is stagnating, and some indicators are even regressing, he said. The SDGs funding gap Annual development spending for developing countries is estimated at $4 trillion, he said, adding that the Global South is disproportionately affected by global uncertainties. “To accelerate progress in SDG“There is an urgent need to address the $4 trillion financing gap,” he said, while seeking ideas for South-South cooperation from developing countries to scale up financing from all sources.

Growth remains the best antidote to many economic and social challenges, Sitharaman said. “Our priority must be a people-centric path of growth that empowers the most vulnerable and marginalized to participate in the development process,” the Finance Minister said.