New Delhi, Sept 4 (KNN)  As the outflows of funds by global investors is playing havoc with the Indian rupee damaging interests of the industry, particularly the import-dependent small and medium enterprises, Prime Minister Manmohan Singh will discuss the issue with the leaders of the rich nations at the St Petersburg meeting of the Group of 20.

In his departure statement here, the Prime Minister said, “Though there are encouraging signs of growth in industrialized countries, there is also a slowdown in emerging economies, which are facing the adverse impact of significant capital outflows.  I will emphasize in St. Petersburg the need for an orderly exit from the unconventional monetary policies being pursued by the developed world for the last few years, so as to avoid damaging the growth prospects of the developing world.”

With almost 25 per cent depreciation in rupee in the last few months, the impact is seen in terms of demand slowdown, rising cost of raw material and difficulties for the employers to retain the manpower being rendered surplus. The SMEs are particularly vulnerable.

The rich nations including the US are members of the G-20 which is a grouping of world’s most rich and influential nations. Along with India, other emerging countries like Russia and South Africa and Brazil are also expected to put pressure on the US to ensure that the capital outflows from the emerging nations should not be done in an abrupt way.  

The G-20 has emerged as the premier international forum for discussing global economic issues. Its 8th Summit will take place against the backdrop of persisting challenges and vulnerabilities in the global economy.  (KNN/PC)