PM leaves for G20 summit in Russia tomorrow
Sep 03 2013 , New Delhi
While the dispute between Russia and the US over the conflict in Syria is likely to overshadow the two-day summit starting Thursday in the Russian city, splits between emerging markets and the US over its winding down of stimulus and the slowing growth of India and other four BRICS countries are expected to remain in focus.
Brazil, India, Russia, China and South Africa--grouped in the informal BRICS bloc seen as an alternative economic powerhouse--all go into the meeting experiencing slowing growth, embattled currencies and huge capital outflows.
The Indian rupee has lost one-fifth of its value against the US dollar this year following major capital outflows triggered mainly due to the moves by the Fed Reserve.
India is also suffering a decade-low growth and GDP rose just 4.4 per cent in the first quarter this fiscal, the weakest performance since 2009.
There has been deep concern in BRICS bloc over the plans to wind down the programme of quantitative easing(QE) which helped their economies expand fast in the last few years after it was launched in the midst of the financial crisis in 2008.
Prime Minister Singh, who said in the Rajya Sabha last week that he commands certain respect in the councils of the G20 in the face of the BJP attack over the economic situation in the country, will deliberate with fellow G20 leaders on how best the reduction
of US stimulus cane be handled without causing undue damage.
Singh had said he would urge the G20 to formulate a coordinated plan to ensure that the winding down of the cheap money policy in the US, under which the Fed buys bonds worth 85 billion USD every month, doesn't cause massive disruption in the economies of the developing nations.
Singh, who has attended all the previous G20 summits since the first meet in Washington in 2008, is due to return home on Saturday.
For India, officials said the topmost priority would be to focus on issues of growth and financing investment to protect its economy from the spillover effects of the QE.
According to some analysts, Syria is a very divisive issue but the whole QE programme is probably even more divisive.