NEW DELHI: China’s stand towards debt restructuring was encouraging at the G20 meeting of finance ministers and central bank governors (FMCBG) in Gandhinagar, finance minister Nirmala Sitharaman said on Tuesday.
Briefing the media she said the discussion around debt restructuring will continue to happen and the issues including those related to haircuts will be part of a round table, which the International Monetary Fund and the World Bank are discussing with India and other stakeholders.
Amid the deepening debt crisis, many countries are seeking sovereign debt restructuring. China has been reluctant to participate in multilateral debt restructuring unless the World Bank and other regional development banks also agree to write down their own loans. The G20 has lent its support to Debt Service Suspension Initiative (DSSI) under which debts of highly indebted countries were suspended for a time period.
On the multilateral development bank (MDBs) report on the requirement of fresh capital, Sitharaman said, “On the capital infusion, the discussions are happening on the overall report on specific recommendations. The road map will come before the summit (in September 2023), so when volume 2 comes and the road map also sets its clear imprint, then the issue of when this capital infusion should happen- now or later.” The G20 Independent Expert Group on Strengthening MDBs in preparing Volume 1 of the Report, and Volume 2 is expected in October 2023.
India was successful in pushing the agenda of debt distress among global south countries that a speedy resolution should happen. Sitharaman said many countries had voiced debt distress issues and wanted it to be put before G20 summit. Meanwhile, the minister has invited views of her counterparts considering the outcome of OECD/G20 Inclusive Framework meeting on international taxation. Finance Ministers and governors were also invited to discuss strategies for capacity building to support the implementation of ‘Two Pillar Solution’ and enhancing global tax transparency under G20 India presidency.