Washington: Expressing disappointment over delay in quota and governance reforms in the International Monetary Fund (IMF) and the World Bank, Finance Minister P Chidambaram has said that this is impacting their credibility, legitimacy and effectiveness.
"We are disappointed that the deadline for the 2010 Quota and Governance Reform of the Fund has not been met. There is no clarity, even after the passage of a year, as to when this will be finally achieved," Chidambaram said during his intervention at the annual plenary meeting of the IMF Committee on Saturday.
Chidambaram urged the member countries not to forget that IMF is essentially a quota based organisation.
"In the absence of ratification of the 14th Quota review, and given its current commitments and possible needs in the future, it has had to place increasing reliance on the NAB and bilateral resources," he said.
"The delay in ratification of the 14th Quota Review will only mean that the reliance on borrowed resources will increase. This is not desirable," he added.
Noting that governance and quota reforms are imperative to ensure IMF's credibility, legitimacy and effectiveness, Chidambaram said that the international body must immediately conclude the 2010 IMF Quota and Governance Reform, as well as complete the 15th General Review of Quotas and arrive at a new quota formula, by the due date of January 2014.
In a separate speech, Chidambarm said that reform of IMF and World Bank is long overdue.
"Only a reformed World Bank and International Monetary Fund will reflect correctly the expectations and aspirations of the world as it is today," he said.
A communique issued at the end of the plenary meeting, said the member countries continue to attach the highest priority to the IMF governance and quota reform to enhance the Fund's credibility, legitimacy and effectiveness.