Expand infra investment in developing nations: Pranab Mukherjee at G-20

PARIS: India on Friday favoured global investment directed towards building infrastructure in the developing countries if sluggish developed economies are to be given a leg-up.

"If we need to add demand to the global economy to offset the moderation of demand by industrialised countries as they contract final output, perhaps a good way of doing this is to expand infrastructure investment in developing countries," India's Finance Minister Pranab Mukherjee said in his intervention at the G-20 ministerial meeting here.

Most of the developed nations, especially in Europe, are grappling with slow growth and there are mounting concerns that the US could again slip into recession.

Mukherjee said there should be a more liberal flow of technology from advanced economies to the developing countries to help sustain the global growth momentum.

"This logic may well be extended to increasing investment in infrastructure generally, and a more liberal flow of technology to developing countries that in turn could spur growth, output and productivity in both advanced and developing countries," Mukherjee said.

India would need nearly USD 1 trillion investment in infrastructure in 12th Five-Year Plan (2012-2017) as the country aims at maintaining a high economic growth.

The two-day ministerial being held here will prepare the groundwork for summit to be held at Cannes on November 3-4.

G-20 is a club of rich and developing nations that account for 85 per cent of the global output and cover two thirds of the world population.

Mukherjee further said that the tax evasion and illicit fund flows have posed serious challenges to world economies.

"A strong and sustainable growth requires effective tax administration nationally and cooperation between countries. We need to start exchanging information automatically for improving tax compliance with partner countries on a voluntary basis and then urging other countries also to do so," he said.

He impressed upon the need for exchanging banking information and assistance in tax collection.