During the 2024 Annual Meeting of the International Monetary Fund (IMF) in Washington, D.C., Indian Finance Minister Nirmala Sitharaman emphasized the need for fair and accurate sovereign credit ratings for emerging markets and developing economies (EMDEs). She argued that current rating methodologies often fail to reflect the true economic fundamentals of these countries, leading to higher borrowing costs and limited access to capital.
Sitharaman called for enhanced engagement with credit rating agencies to improve their assessment models, ensuring they more accurately capture a country’s repayment capacity and economic resilience. She highlighted that such reforms are crucial for EMDEs to attract private investment and achieve sustainable growth.
In addition to addressing credit rating concerns, the Finance Minister advocated for governance reforms within the IMF and other global institutions. She noted that the evolving global economic landscape necessitates adaptations in these organizations to better serve the needs of all member countries.
Sitharaman also endorsed the IMF’s current Global Policy Agenda, which focuses on securing a “soft landing” for the global economy and breaking free from cycles of low growth and high debt. She acknowledged the resilience shown by the global economy in 2024 but cautioned about persistent risks, including geopolitical tensions and weak medium-term growth prospects.
Her remarks underscore India’s commitment to fostering a more equitable global financial system that supports the development goals of emerging economies.
