Greater Noida, May 5: India has made a case for stepping up financial resources of the Asian Development Bank (ADB) to help it speed up the poverty alleviation programmes and promote infrastructure in developing countries.
"We now need to substantially expand the resource base of multilateral development banks so that they have the firepower to help developing countries reach their growth potential," Prime Minister Manmohan Singh said in his inaugural address at the 46th Annual General Meeting of ADB.
This, he added, was necessary to prevent the level of ADB lending from coming down as is being projected.
"At this juncture, ADB should take the initiative to find innovative ways to channelise global savings into infrastructure projects," Singh said.
Earlier, Finance Minister and Chairman of ADB Board of Governors, P Chidambaram has said that the level of lending by ADB is expected to decline from USD 10.1 billion to USD 8.0 billion.
Observing that the financial position of ADB is constrained, he said, "the support that ADB can deliver for economic development and poverty reduction in the region will
be seriously constrained by the lack of adequate capital. We may hit the wall in about three years."
Chidambaram said it "behoves us" to focus on the issue of how to at least maintain, and preferably augment, ADB's capacity to support development in the region and achieve the goals enshrined in Strategy 2020.
"If ADB must continue the important role that it has played so far in the region, its resource base has to expand considerably and keep pace with the needs and absorptive capacity of the region," he said.
Chidambaram said financial position of ADB in the future is a matter that should engage the attention of member countries and must be accorded the highest priority.
He asked the members of the ADB board to "consider ways and means to increase ADB's resources to meet Asia's needs for infrastructure, economic growth and poverty reduction."
On global economy, he said the unfavourable economic trends in the advanced economies have acted as headwinds to the development efforts.
"The developing countries in the Asia-Pacific region continue to suffer from sluggish external demand and inadequate financial resources," he added.
He further said that in the midst of financial turmoil in the euro area and the US, the Asia Pacific region has functioned as perhaps the only 'growth engine' of the world.
"We are fortunate that domestic factors have remained the main drivers of growth, but the continuing economic crisis in the developed world has severely constrained our efforts to rebalance our economies," he said.
Asian Development Outlook 2013 has pegged developing Asia's GDP to expand by 6.6 per cent in 2013 and 6.7 per cent in 2014. IMF's World Economic Outlook has projected growth of over 7 per cent in 2013 and 2014 for the region.
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