Economic crisis can affect rest of world: warns PM

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Paris, Sep 30 (UNI) Prime Minister Manmohan Singh has expressed concern at the current financial crisis affecting developed countries and warned that it could spread to the rest of the world.

''We live in an inter-dependent world and the fate of all countries is related to the international financial system. Our value markets are open to the world and, if they are affected, this will impact on our capacity to finance our development.

If the financial crisis sparks off a recession in the main economies, this will compromise our exports,'' he said in an interview with Le Figaro, a prominent French daily, published today.

Interestingly, Planning Commission Deputy Chairman Montek Singh Ahluwalia had said it would have a neglegiable impact on the Indian economy.

The Prime Minister said President Sarkozy's proposal of a new international financial structure was important and the only thing was to well prepare the meeting which he is planning.

President Sarkozy said yesterday he would convene a meetiing of four European countries, which are also members of the G-8, to discuss the international financial structure and the current financial crisis.

Asked if India could help the global economy in these difficult times, the Prime Minister said after China, India is the second largest economy in terms of growth.

''We are, therefore, potentially a significant actor, but this does not mean that we are a decisive one. The main responsibility is that of the developed countries, but India and China must take part in the solution,'' he added.

To a question on whether the negotiations for a free-trade agreement with the European Union indicated that India prefers bilateral agreements over multilateral negotiations within the framework of the WTO, Dr Singh hoped that negotiations with the WTO could be saved..

India is working with other countries towards the success of the Doha round.

''The Free Trade Agreement with the EU is not a substitute for Doha. It is complementary. I would call this "Doha plus",'' the Prime Minister said.


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