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| Wednesday, 31 March 2004 |
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IMF asks India to lift trade barriers, check debt, deficit problems WASHINGTON, Tuesday (AFP) The International Monetary Fund has urged India to lift trade barriers and check its burgeoning public debt and fiscal deficit to boost the country's standing in the global economy. David Burton, the IMF's director of the Asia and Pacific department, said India was not as open as China even though it was growing rapidly on the back of exports and expansion of its key information technology sector. "India is definitely emerging as a force in its own right in the global economy," he said in an interview with the Fund's in-house publication IMF Survey. "But India isn't as open as China, which probably holds it back and keeps it from having as big an impact on the global economy." Burton noted progress in corporate restructuring in India but said more needed to be done on the trade front if the world's second most populous nation wanted to keep growing. "Trade liberalization is certainly one area where it really needs to focus, because its trade restrictiveness is much higher than in other countries in emerging Asia," he said. Another key area for reforms, he said, was the agricultural sector, adding that this would help raise productivity and incomes of the large rural population. Burton said the IMF had also been "harping on for a while" to India to tackle its very large public debt and high fiscal deficit. "There are some signs that the deficit is beginning to come down, but it will take a big effort to put things on a sustainable path," he said. On economic growth in Asia as a whole, Burton said global economic expansion was "strengthening and deepening" and that the near-term prospects for the region looked good. For emerging Asia - which includes all of Asia except Japan - the IMF expects growth this year to be over seven percent, broadly the same as last year. |
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