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Global economic slowdown can have dangerous impact on India: Sinha

Finance Minister Yashwant Sinha has warned that the slowdown in world economy would have dangerous impact on developing nations like India and several countries could move towards a debt trap.

Global slowdown in the economy would have an uneven impact on the world population and various countries, especially the developing countries, would have an adverse effect than the rich nations, Sinha said.

"While it would perhaps mean less prosperity for the people of developed countries, it would mean more poverty for the people in developing countries," he said at the high-level meeting of the UN Economic and Social Council with the Bretton Woods Institute in New York on Tuesday.

Amplifying his strategy, Sinha said it was important that economies of poorest countries being provided with a debt waiver be strengthened to ensure that they do not fall into a debt trap again.

"That can happen only if they are able to utilise fully the opportunities in international trade," he said.

"We, therefore, have called upon the World Bank to assist developing countries, especially the poorest of the poor among them with capacity building to enable them to take advantage of global trade opportunities," he said, adding there was also an urgent need to enhance their negotiation capacities to secure better market access.

Underlining the role of the World Bank for middle income countries, Sinha said, the Bank should act as a catalyst for policy and institutional change, including capacity building as well as pro-poor policies.

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