by Shaun Tandon and Mauricio Rabuffetti
LOS Cabos, Mexico, June 18, 2012 (AFP) - India pledged $10 billion on Monday for a new IMF firewall meant to prevent future crises, marking a new level of commitment by an emerging economy as it seeks a greater voice.
At a summit of the Group of 20 major economies, Indian Prime Minister Manmohan Singh said that his government would contribute $10 billion to the fund meant to support nations at risk of contagion from the global crisis.
"The global economic situation is deeply worrying. Economic recovery is faltering and even fast growing emerging markets are slowing down," Singh, an Oxford-educated economist, told the summit in the Mexican resort of Los Cabos.
Singh earlier met with fellow leaders of the so-called BRICS -- Brazil, China, Russia, India and South Africa -- and the group pledged to boost their contributions to the new fund, while not giving an exact figure.
The International Monetary Fund, hoping to prevent a worsening of the global economic turmoil, called last year for $500 billion in an emergency firewall. But the money has fallen short and it lowered its goal to $430 billion.
In a joint statement, the BRICS said they were ready to step up contributions to the new fund but expected their money only to be used after current resources "are substantially utilized."
The five leaders also renewed call for a greater say at the IMF and World Bank, which have historically been dominated by the United States and Europe.
"These new contributions are being made in anticipation that all the reforms agreed upon in 2010 will be fully implemented in a timely manner, including a comprehensive reform of voting power and reform of quota shares," the BRICS said.
The emerging economies' willingness to contribute comes even though the United States, the world's largest economy, has refused to take part.
President Barack Obama is eager to fix the woes of the eurozone, which are clouding over the US economy and his own re-election hopes, but faces intense political resistance at home to new financial commitments.
After Group of 20 finance ministers and central bankers met in Washington in April, the IMF said it had come up with only $340 billion of the $430 billion it had aimed for the firewall.
The eurozone is by far the largest contributor, promising some $200 billion, raising concerns by some potential contributors that the firewall would eventually turn into a new European bailout fund.
In a draft copy of the G20 summit's statement obtained by AFP, the leaders promised the $430 billion firewall "will be available to the whole membership of the IMF and not earmarked for any particular region."
The G20 draft also recommitted to reforms of the Washington-based lender, saying that they were "crucial to enhancing the IMF's legitimacy."
Japan has contributed $60 billion, while Britain, South Korea and Saudi Arabia have each pledged $15 billion. Singapore and other European governments have also contributed smaller amounts.
Japan, speaking ahead of the BRICS statement, said that it made its contribution with the hope that other countries would follow suit.
"We also expect other countries, like our good neighbor China, to express its will to enlarge its credit line," Japanese foreign ministry spokesman Yutaka Yokoi told reporters.
Yokoi said that Mexican President Felipe Calderon, the host of the summit, said that his country planned to contribute to the fund when he met with Japanese Prime Minister Yoshihiko Noda.