Asia has big shift of role in rebuilding global economy: Indian economist

10:02, February 06, 2010      

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A leading Indian economist and government official said on Friday Asia's Gross Domestic Product (GDP) will become a significant contributor to the world GDP in a span of few years.

In a speech on global economic situation, Indian Deputy Chairman of Planning Commission Montek Singh Ahluwalia said here that there was a "big shift in the last 12 months in the role played by Asia in rebuilding the global economy."

"While the world contracted, the Asian economies grew. Asia has to take over the world leadership in directing the global economy but was not yet ready. Asia still looks at U.S. and Europe to play the leading role," he said, when addressing the National Consultation on the People's Mid-term Appraisal of the 11th Five- Year Plan of India.

Ahluwalia, however, said that some of the industrialized world was making "noises" of protectionism.

"One of the key challenges that Asia would face would be the role it would play to control and lead the rules of the game," he said.

The recovery in the world economy was primarily driven by consumer demand.

He said Asia's market has to been seen from the latent market perspective to get an understanding on the true market size and that Asia requires ferocious customization for capturing the market size.

"Some of the key challenges being faced by the world today are fragile banking systems, global trade imbalances and unemployment. These challenges will lead to higher degree of intervention by governments in directing and managing the global economies," Ahluwalia said.

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