India supports BRICS Bank’s Membership expansion

Final G-20 Finance Ministers and Central Bank Governors Meeting under the 2018 Argentine Presidency and the final BRICS Deputies Meeting under the 2018 South African Chairmanship were held on 11th -12th October 2018 in Bali, Indonesia on the sidelines of the IMF/Fund Bank Annual Meetings.

The BRICS Deputies Meeting focused on reviewing the progress achieved by the BRICS Forum in 2018 as well as deliberating on the way forward under the upcoming 2019 BRICS Chairmanship of Brazil.

On the Finance Ministry track, the main issues that came-up for discussion were the membership expansion of New Development Bank (NDB), the staggering of schedule of payment of paid-in capital of NDB, the work of BRICS PPP Task Force and examining the possibility of developing a consensus on BRICS Rating Agency.

On the Central Bank track, the discussions centred on the test run of the BRICS Contingent Reserve Arrangement undertaken by the Central Banks in 2018, the Fintech stocktaking exercise and the progress of work happening in the BRICS Bond Fund Working Group.

 Department of Economic Affairs Secretary (EA), Shri Subhash Chandra Garg, in his interventions indicated India’s unequivocal support for NDB’s membership expansion. Further, he called upon the BRICS Deputies to endorse the membership expansion plan of NDB following which the NDB Board along with the Management can continue with their work on finalizing the processes for membership expansion. Secretary (EA) also emphasized that the role of BRICS is to provide broad guidance to NDB and the decisions on managing the micro details should be left to NDB Board of Directors and Board of Governors.

On the BRICS Rating Agency, Secretary (EA) indicated that the Report of the Expert Group set-up to study the feasibility of BRICS Rating Agency has envisaged the setting-up of a BRICS Rating Agency which is completely independent and private sector led.

Secretary (EA) emphasized on the need felt by the emerging markets and developing economies for a rating methodology that takes into account the country circumstances of these economies. In this context, there was a need for BRICS to take lead and work together on the setting-up of a BRICS Rating Agency.

Source: Clipper 28 (Press release)

 

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