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Jobs, slowing investment, US Fed hike policy challenges: Jaitley
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SME Times News Bureau | 16 Oct, 2017
Employment creation, the global
slowdown in investments and the possible impact that the US Federal
Reserves move normalise monetary conditions can have on emerging
economies are three major policy challenges, Finance Minister Arun
Jaitley has said.
"The risks posed to emerging markets and
developing economies by the US Federal Reserve's steps towards restoring
normal monetary conditions, the global slowdown in investments and
employment are the three policy challenges," Jaitley said at a
discussion here of the International Monetary and Finance Committee
(IMFC), according to a statement from the Finance Ministry on Sunday.
Monetary
policy tightening in the US could cause capital outflows from emerging
economies affecting their current account deficit, he said.
Jaitley
also said the highest priority for the government is to create new jobs
as millions of young people enter the workforce every year.
"India
is currently one of the few large economies in the world in the
virtuous phase of its demographic transition and the most important
priority of the government is to find ways to provide employment to the
12 million young people entering the workforce annually," he said.
Jaitley,
who led the Indian delegation to the annual meetings of the
International Monetary Fund and the World Bank, said the short-term
adverse impact of the Goods and Services Tax GST and demonetisation have
been mostly overcome.
"Recent data in manufacturing sector indicate that India's growth story is soon getting back to its normal course," he said.
Addressing
the annual meetings of the IMF and the World Bank here on Saturday, he
called for urgent revision of the IMF quota in favour of dynamic
emerging markets so as to reflect the ground realties of the world and
hoped this could be accomplished as part of the 15th General Review of
Quotas.
"There is an urgent case for revising quota shares in
favour of dynamic emerging market countries in line with global
economic realities to maintain fairness in the governance structure of
the Fund," he said.
"We should make every effort to complete the 15th Review by the agreed timeline of 2019 Annual Meetings," he added.
Regarding
the World Bank Group, Jaitley said the unanimously agreed Lima Roadmap
had earlier envisaged a conclusion of the 2015 shareholding review by
the Annual Meetings 2017.
"While we note that we failed to
deliver it, given the progress that has been made so far, we strongly
urge all to commit to deliver an equitable conclusion of this process
for both the IBRD and IFC by the Spring Meetings 2018," he said.
"We
look for an expeditious decision on capital enhancement through both
selective capital increase (SCI) and general capital increase (GCI) for
both the IBRD and IFC, by Spring Meetings 2018," he added.
The
Indian Finance Minister warned that sudden reversal of monetary
accommodation by advanced economies could increase policy strains in
emerging markets and developing economies (EMDEs).
"The risks of
growing populism and consequential loss in trade volumes will affect
global recovery adversely, and it is incumbent upon all of us to foster
cooperative multilateral efforts to boost fair trade practices," he
said.
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Customs Exchange Rates |
Currency |
Import |
Export |
US Dollar
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66.20
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64.50 |
UK Pound
|
87.50
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84.65 |
Euro
|
78.25
|
75.65 |
Japanese
Yen |
58.85 |
56.85 |
As on 13 Aug, 2022 |
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