Gyeongsang(South Korea), Oct.22 (ANI): Indian Finance Minister Pranab Mukherjee met his Canadian counterpart Jim Flaherty in South Korea's Gyeonsang province on Friday.
The two leaders reportedly discussed the realignment of developing and emerging countries hit by recession, and ways for its recovery.
Mukherjee is in Seoul to participate in a finance ministers' meet ahead of the G20 Summit, which is to be held on Nov. 11-12, and will involve 10,000 participants and 32 heads of state.
On Thursday, Mukherjee said the focus of the discussions would be on the recovery of countries that were hit by economic recession in the year 2009.
He also said that currency appreciation by China is also one of the major steps towards getting the world economy back to its form.
The minister said that according to the latest forecast of International Monetary Fund (IMF), recovery in the whole of Europe is not very robust, and same is the story with North America, which meant the major economies are not going to recover very fast in the desired and expected way.
He said that a method or mechanism should be set through which the recovery process can begin.
"The entire world leaders, they accepted the policy of fiscal expansion, provided stimulus package to the recovery of the economy. Now after recovery, it was thought that there is a need of fiscal consolidation; the level of fiscal expansion, which took place during that period cannot be sustained over a longer period of time," said Mukerjee.
"So, there comes the question of exit policy. In the last meeting, we decided that it would be desirable to have a country-specific strategy for the exit policy," he added.
Mukherjee also said that in the last finance ministers' meet, it was suggested that the fiscal consolidation process should not be implemented at one go. It should be calibrated, so that there is no dearth of capital, which is required for the development of the developing countries.
"Of course, the reform of the financial institutions including IMF, quota shares, then governance, board of governors' composition, election to the 19th members are to take place in the IMF. And IMF reform process has not been completed though some quota alignment, realignment has taken place, but it has not yet been gratified by the countries having 85 percent of the vote shares," said Mukherjee.
Economic imbalances, the falling dollar and pressure on emerging market currencies to rise are set to dominate meetings in South Korea of G20 finance ministers from Oct. 22 and national leaders from Nov. 11.
South Korea will also hold this week's meetings of finance ministers and central bank governors from the 20 major economies. By Lokender Singh (ANI)