GS2 · 10 marks · 150 words

What are the key areas of reform if the International Monetary Fund (IMF) has to align with the current economic realities?

Answered by 3 toppers · CSE 2023–2025

Global Institutions

Syllabus: Important International institutions, agencies and fora- their structure, mandate.

How toppers approached it

From 2 of the 3 answers · about 150 words · 50% drew a diagram.

Opening

  • No separate opening2 of 2

Body

  • Points2 of 2

Close

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The toppers’ answers

Aditya SrivastavaAIR 1 · CSE 2023 · 40 wordsTheir whole copy

Opening

IMF has often been under the scanner for its conditionality and lack of sensitivity to the local needs.

Body

Diagram
Need for reform -> too much control of the West -> Top down approach of funding -> Conditionality causes political upheaval (Eg: Pakistan) -> funding not sensitive to the local needs (Eg: Srilanka -> no boost to tourism)
Diagram
Way ahead for reforms -> promote autonomy -> funding quota rationalization -> promote participative conditionality -> stakes in framing the condition -> promote the value of democracy as it is being threatened by Global South -> BRIC has New Development Bank & Contingency reserve -> Promote the better usage of grants -> build capacity of the loan taker

Close

This would help to ensure the IMF stays relevant in today's era of new world order and is representative of the same.

More on Global Institutions

The UN, WTO, IMF, World Bank and multilateral fora.

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