He also said that India-Brazil-South Africa (IBSA), three leading emerging economies, were united in their efforts to address the deficit in global governance and pressed for enlargement of the UN Security Council to reflect the present day reality.
"The sovereign debt crisis in Europe and recessionary trends in the traditional engines of the global economy - the US, Europe and Japan - are sending negative signals to world financial and capital markets which are showing signs of distress," Singh said addressing the plenary session of the IBSA Summit here.
"Developing countries cannot remain untouched by the negative impacts of these developments. Their ability to address their developmental challenges has been adversely affected," he said.
"We hope effective and early steps will be taken by Europe and other advanced economies to calm the capital and financial markets and prevent the global economy from slipping into a double-dip recession," Singh added.
With G-20 summit in the offing in Cannes early next month, Singh said IBSA countries should cooridnate their positions in the run-up to it to ensure that priorities of the developing economies are adequately reflected in the deliberations of the grouping.