The world is looking at India as a destination for investment: Gita Gopinath

While the IMF has forecast a lower growth rate for the global economy in 2023 compared with this fiscal, a positive trend for India is that countries that are looking to diversify their supply chains are looking at India as an option, said International Monetary Fund’s First Deputy Managing Director Gita Gopinath in an interview with Mint. In a wide-ranging interview, Gopinath spoke about India’s top priorities during its G20 presidency, the impact of China’s slowing economy, the fallout from a strengthening dollar, the need to stem the global rise of economic protectionism, and the headwinds facing emerging market economies. She feels the deep correction in the crypto markets has thus far been contained and there is no substantial spillover to other asset prices or parts of the economy, there is no serious risk of an emerging markets economic crisis at the moment, and that the sentiment about the Bretton Woods institutions being outdated is perhaps misplaced. She welcomes the feedback, however. Edited excerpts:

From your engagement with India on G20, what do you reckon are our top priorities during the G20 presidency?

We are working very closely with India on its G20 presidency. India has very good set of priorities. India is pretty much focused on ensuring that the Global South, especially the low-income countries, has sufficient access to finance. That is a priority. Also, India cares a lot about energy and food security that is critical for developing countries and more generally, around the world. That is one area we are working with India. A second major area is in the space of debt. We have around 60% of low-income countries that are either already in debt distress or in high risk of debt distress and we need to have effective debt resolution mechanisms. The G20 produced what is called the common framework to provide this kind of mechanism and while it has had some success, we really do need significant changes to make sure that it delivers much more quickly. India is very keen towards making that happen and we are working with India on that. A third area is the crypto landscape. We have seen the meltdown in that sector and we should make sure that we have regulations in place. Another area is climate finance. The risks from climate change are tremendous. Countries need to adapt and mitigate and for many developing countries, you need large scale financing to make that happen. How do we get enough financing? That is another area on which we are working with India.

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