India Economic Summit | Pranab Mukherjee on climate change

India Economic Summit | Pranab Mukherjee on climate change

New Delhi: Articulating India’s stand ahead of a key meeting in Copenhagen in December, finance minister Pranab Mukherjee stated that rich nations will have to take responsibility for environmental degradation and will have to pay appropriately more for their dominant role in climate change over 200 years of industrial development.

“We have to keep in mind the historical back-drop…it should be accepted that the responsibilities should be common but differentiated depending upon the capability of the state concerned," Mukherjee said at the World Economic Forum’s India Economic Summit Tuesday.

“The applicable forum for consideration should be United Nations Framework Convention on Climate Change (UNFCCC)," he added.

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Speaking at the same conference, Venu Srinivasan, chairman and managing director TVS Motor Company said that the two significant issues facing the world were WTO and climate change.

Mukherjee said that the agenda discussions at the recently concluded Pittsburg summit were about additional support to combat financial crisis, stability in financial markets, financing of climate change and the exit strategy. He also outlined the road map for withdrawal of Indian stimulus and the agenda of returning to path of fiscal consolidation.

“In 2008-09 India clocked a GDP growth of 6-7%. If you compare it with previous two quarters figures, it was reasonably acceptable. The question is how we proceed from here… In due course we will have to take corrective measure," he said while stating his intentions to bring down the fiscal and revenue deficit to 6.4% and 4.5% respectively by 2012.

Prime Minister Manmohan Singh said on Sunday at India Economic Summit that the stimulus measures announced in the last fiscal to combat the economic slowdown would be wound down next year following recent signs of an upturn in the economy.

The fiscal stimulus came in the form of both budgetary support for select sectors and cuts in indirect taxes such as Central excise and service tax. The Union government announced a fiscal stimulus package of Rs1.86 trillion while the Reserve Bank of India (RBI) provided potential liquidity of around Rs5 trillion, shielding the economy from the global financial crisis.

On 27 October, RBI signaled that it was exiting its loose monetary policy regime and turning its sights to dealing with higher inflation, estimated to reach 6.5% by the end of March.

Answering a question about India reaching the growth levels of 9-10%, Mukherjee said, “If the situation remains normal, by 2012 we will be able to achieve the magic figure. I will be happy if we achieve 7% for the next year and the 8% for the year after that and then take it up from there."

India’s economic growth which had grown at 9% for three consecutive years making it the second fastest growing economy in the world, slowed to 6.7% in 2008-09 in the backdrop of the worldwide financial crisis.