India’s finance minister Palaniappan Chidambaram said Monday in Washington, “Regulation must stay one step ahead of innovation”.
He said the developed countries’ financial authorities are not keeping up with the new and complex financial market instruments that lay behind recent credit market turmoil.
“Thanks to the present crisis which originated in the advanced economies … I think developed economies will listen more to the developing economies’ point of view,” Chidambaram remarked.
“In the name of innovation, regulators or governments in the advanced economies have fallen behind the curve.”
The time has come for the developed world to attend to its own problems, and stop lecturing emerging economies about what is right and what is wrong, he said.
“For too long the advanced economies have told the developing economies that this is right and this is wrong,” Chidambaram told Reuters on the sidelines of the annual meetings of the IMF and World Bank.
As growth looks sure to slow in much of the rich world, partly due to the fallout from reckless lending in the United States, new economic powerhouses like India say they are tired of being told what to do. Read more.