VZCZCXRO3597
RR RUEHAST RUEHBI RUEHCI RUEHLH RUEHNEH RUEHPW
DE RUEHNE #2944/01 3231234
ZNR UUUUU ZZH
R 181234Z NOV 08
FM AMEMBASSY NEW DELHI
TO RUEHC/SECSTATE WASHDC 4262
INFO RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVE
RUEHGV/USMISSION GENEVA 7955
RUCPDOC/DEPT OF COMMERCE WASHDC
RHEBAAA/DEPT OF ENERGY WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RULSDMK/DEPT OF TRANSPORTATION WASHDC
RHMFIUU/FAA NATIONAL HQ WASHINGTON DC
RUEHRC/DEPT OF AGRICULTURE WASHDC

UNCLAS SECTION 01 OF 02 NEW DELHI 002944 
 
SIPDIS 
SENSITIVE 
 
STATE FOR SCA/INS AND EEB 
USDOC FOR ITA/MAC/OSA/LDROKER/ASTERN/KRUDD 
DEPT PASS TO USTR MDELANEY/CLILIENFELD/AADLER 
DEPT PASS TO TREASURY FOR OFFICE OF SOUTH ASIA MNUGENT 
TREASURY PASS TO FRB SAN FRANCISCO/TERESA CURRAN 
 
E.O. 12958: N/A 
TAGS: EAGR ECON EFIN EINV ETRD IN
 
SUBJECT: INITIAL POST-SUMMIT GOI REMARKS 
 
¶1.  (SBU) SUMMARY.  Prime Minister Singh and Finance Minister 
Chidambaram have made positive remarks in their early days back from 
the G-20 Summit held November 14-15, while Commerce Minister Nath 
has made some unhelpful - but not uncharacteristic - protectionist 
references.  Singh and Chidambaram emphasized the importance of the 
Summit attendees consisting of the G-20 rather than just the G-8. 
Singh termed the summit a "success" and highlighted that developing 
countries would be given additional infrastructure-focused finance. 
Nath, on the other hand, seemed to disregard the G-20 Declaration's 
call against protectionism, and declared he would guard against 
cheap imports flooding India.  End summary. 
 
PM SINGH NOTES SATISFACTION WITH SUMMIT 
--------------------------------------- 
 
¶2.  (U) Prime Minister Singh spoke with reporters on his return 
flight to India after the Summit, emphasizing that the inclusion of 
the G-20 rather than the G-8 indicates that the "balance of power is 
increasingly shifting in favor of the emerging economies."  He 
deemed the November 15 meeting a success, with complete agreement on 
several critical areas.  He acknowledged that he had had 
reservations about the ability of the US and Europe to agree on 
common goals.  Instead, all the participants had agreed to the need 
for fiscal stimulus, which Singh stated was already underway in 
India, pointing to high farmer support prices, farmer debt write 
off, expanded social services and infrastructure expansion. 
 
¶3.  (U) Singh approved of the G-20's acknowledgement that the 
developing countries were suffering from a crisis not of their 
making.  He noted that it was agreed that infrastructure investment 
would be important to sustain growth in developing countries and 
thus the international financial institutions (IFIs) would open new 
facilities to assist towards that end.  Finally, he pointed to the 
reform of IFIs in their supervision and management systems and their 
giving greater weightage to emerging countries. 
 
FINANCE MINISTER SUPPORTIVE BUT NOTES "REGRETS" 
--------------------------------------------- ---- 
 
¶4.  (U) Finance Minister Chidambaram spoke about the G-20 Summit at 
the annual India Economic Forum - an offshoot of the World Economic 
Forum - on November 18.  He echoed the Prime Minister's satisfaction 
with the inclusion of G-20 members, as a recognition that developing 
countries also had a vital role to play in finding ways to address 
the financial crisis.  Chidambaram stated that the industrialized 
countries realized they needed to engage growth centers and other 
emerging economies, asserting that the G-20 has "come to stay".  He 
wouldn't predict whether the G-20 would replace the G-7 but did 
think the G-20 would become the most important multilateral group of 
countries.  Chidambaram further opined that Africa is 
under-represented in G-20, and Europe "a bit" over-represented, but 
judged that now is not the time to deal with such concerns. 
 
¶5.  (U) Chidambaram then identified two "regrets" from the Summit - 
President-elect Obama's absence and the failure to establish a 
global oversight mechanism to identify problems to national 
governments and regulators for action.  The Finance Minister said 
India and other "like-minded" nations wanted to know if the incoming 
Administration endorsed the US views put forth at the Summit.  He 
also lamented the absence of a new global oversight mechanism, 
although he was quick to define the role as advisory to 
national-level regulators.  Chidambaram reiterated that he believed 
that the G-20 would not support a global regulator, but could use an 
oversight mechanism.  Further, Chidambaram suggested that a group of 
"wise men and women" should be established to oversee implementation 
of the G-20 Summit action plan and report periodically to the G-20. 
 
 
COMMERCE MINISTER NATH'S PROTECTIONISM 
-------------------------------------- 
 
¶6.  (U) Senior Indian economic officials met with Prime Minister 
Singh on November 17 to discuss possible measures to assist the 
industrial sector, and in particular, exporters.  Among the policy 
measures discussed by Finance Minister Chidambaram, RBI governor 
Subbarao, and Commerce Minister Nath were assistance with insurance 
and credit terms for exporters, increases in lines of credit, and 
 
NEW DELHI 00002944  002 OF 002 
 
 
increases in import duties in certain sectors.  The RBI has already 
extended pre-shipment credit for exporters from 180 days to 270 
days. 
 
¶7. (U) Commenting after the meeting with the Prime Minister, 
Commerce Minister Kamal Nath underlined the need to stop imported 
'cheap goods' from hurting domestic industry.  He noted that there 
was a significant overhang between India's applied rates on a wide 
range of industrial goods and its WTO-bound rate.  "We will take 
measures to prevent cheap imports from coming in.  We will not 
hesitate to increase tariffs sharply for sectors like chemicals and 
engineering," Nath emphasized. 
 
WHITE