Panel Discussion - South Asia's Path to Resilient Growth

bien, Deputy Managing Director of IMF, Anand Nagiswaran, Chief Economic Advisor of India, Um Nandala Virasanke, Governor of the Central Bank of Sri Lanka, Samsul Alam, Minister of State of Bangladesh and Mahaprasa Radhikari, Governor of Nepal, Raster Bank. Now I hand it over to Krishna to start the

panel

, thank you, thank you. program um again good afternoon to everyone present at this high-level policy

panel

on strengthening institutions for sustainable

growth

in the post-world covered again just to highlight some data from the book that was launched today in the previous period to the pandemic there was a marked decrease in poverty worldwide, but especially in South Asia, in fact, if the five countries Bangladesh Bhutan India Maldives Nepal and Sri Lanka are put together, extreme poverty decreased from 500 million to less than 250 million per capita income doubled in real terms and the region's share of global GDP grew from less than five percent in 2000 to more than eight percent in 2019.

Beyond the numbers, if you look at any metric of the access to healthcare education, etc., access to the Internet, everything improved significantly, but then greed struck and we have had since Kuwait back-to-back crises, war, cost of living crisis, etc., and all of this has a severe blow to

growth

and energy reduction, and there is a significant increase in people living in extreme poverty and some of the pre-pandemic conditions. vulnerabilities have been exacerbated, for example, as one governor cited this morning, debt levels have increased dramatically, so overcoming these challenges and achieving the SDG goals will require serious reform efforts in all countries, in some sense , this is a central strength of the book, so today's panel I'll start with uh uh DMD antennas.

I highlight some key messages from the book that could then set the stage for the

discussion

of what happens after that, thank you, thank you, thank you very much, Krishna, so as I mentioned this morning, sorry, not this. It doesn't work, I guess I'm not sure now, as I mentioned this morning in my opening remarks. The book draws lessons from South Asia's own history, as well as cross-country comparisons with its peers and the The central question that was also underlined this morning is how South Asia can return to the growth rates of the last two decades and resume the poverty reduction push that Krishna just described in this post, uh, greed, uh, era, so, you know how this works. can be done in a way that achieves equitable and climate-friendly growth and without a renewed buildup of macroeconomic vulnerabilities, we are already seeing significant vulnerabilities and several chapters of the book take a longer-term perspective and draw lessons from South Africa.

The development experience in recent decades comes and gives us three important lessons: the first is that there is very strong evidence in the book that sustained growth is essential for poverty reduction, there is no doubt about it. The second lesson is that the growth accelerations experienced in um uh in South Asia came in the wake of the pursuit of major reforms and third, that reforms in South Asia were generally less profound than in other parts of Asia and that In recent times the reform momentum has actually slowed. down, so the book goes on to highlight several structural constraints to growth that must then be addressed, trade barriers remain high, one of them being governments that still play an important role in economic activity and existing ones.

Companies have less incentive to be innovative, diversify and become more competitive in new export markets, so South Asia struggles to provide employment, so it is young and consequently many of them are migrating to other countries. places rather than contributing to South Asia's own development, so it is clear that reforms are needed to unlock South Asia's full potential. These cover three broad areas that were also addressed this morning. The first is that policies that support growth are inclusive growth, sustainable and

resilient

growth, including climate change, without a doubt. What must be pursued secondly is to promote trade and global integration of the global value chain.

It is very important that we have reformed the reforms that of course go hand in hand with that and the third is the general role of macrofinancial macrofinancial management, better macrofinancial management. So I think those are the key lessons and themes and directions for reform that the book details. Yes, thanks Anthony. I'm going to start by asking Mr. Nageshwaran questions because he has to leave at 5:30, so here we go. We're going to optimize all the time here, let me ask you a very specific question. Anthony talked about structural impediments, so from an Indian perspective, what are some of the key structural and institutional impediments that policymakers need to focus on to ensure strong and inclusive growth?

Go ahead, okay, thank you Krishna, good afternoon to everyone who knows. Krishna's question is about structural impediments to strong and inclusive sustainable growth and also the topic of this session is about institutions, so I think they typically overlap when we think about an institutional framework to ensure. sustainable and inclusive growth we think of fiscal policy frameworks: monetary policy framework consisting of an independent inflation targeting regime of the Central Bank and then autonomous regulatory bodies to regulate public services or other monopolies and, of course, an independent judiciary , etc., but when we talk about the Indian context most of These things are present, they may not be present in their entirety, they may not be present to the extent that some people would expect, but we have most of these boxes ticked in the Indian context.

Of course, one can talk about the absence of a fiscal policy framework at a lower level. levels of government etc. but anyway, there are fiscal rules for both union government and state governments, there is a Bank of India which oversees some of them etc. and there are also automatic checks and balances , so these standard frameworks are more or less implemented. So what are the other structural impediments? So I would say that I would speak again initially from the State capacity angle, so one of the things that we noticed is that generally in the State and Union governments etc., at the policy formulation level , contrary to public perception. that governments are overloaded, etc.

I would even say that at the highest levels we need more people, rather than fewer, because many people, many at the upper levels of the bureaucracy, are actually burning both ends of the candle in terms of the amount of workload that they carry. . and therefore I think that one of the issues of state capacity has to do with strengthening the top bureaucracy and that, in my opinion, is also an impediment and the second thing I would say is that, of course, I am here again. The Indian government is off to a very strong start in the last few years.

One of the ways in which perspectives and horizons are broadened is to also encourage, wherever feasible and appropriate, lateral hiring that the Indian government has been doing in recent years. recent years, but that can also be done more in more areas where it is feasible, desirable and even appropriate because it brings new perspectives, different thinking and also capacity for a fusion of good practices from the private sector to the public sector and vice versa, and also helps people who come from outside the government framework to understand how governments work and what things they prioritize in the process.

Compliance with due processes, etc., so it will be something that will be synergistic and beneficial for both parties and that you need. apart from that, I would also say that the other structural impediment is that we must ensure that the execution and implementation of the project is done at all levels of government without time and cost, because to the extent that the public sector is still very active in terms of capital expenditure, especially in the last 10 years, when in general the private sector and the financial system were undergoing a repair of their balance sheets and when the public sector, therefore, took over the main capital investments, then it is necessary to have the public sector. to be able to execute projects on time and without cost and time overruns and therefore the process of timely monitoring and course Corrections and implementation and sequencing these are all I would say that all the structural factors that need to be strengthened I will stop Here, thank you very much, navigation, Let me ask you one more question before I move on to the others.

One of the areas where India did very well in the context of the pandemic was digitalization and in a sense it reflected many things. reflected a public-private partnership reflected the fact that in the context of the slowing economy we found a sector that could grow faster and could help promote growth in many areas that were previously untouched, so what explains India's success in digitalization and what lesson? Is it offered to South Asian countries on that front? No, that's it again. It's a question that will probably require another day of seminar to complete. So I'll try to be brief.

I think some of the foundations for the success of this digital infrastructure. were established in the past, obviously, uh uh, in terms of the ecosystem, the number of software engineers, etc., which apart from the financial inclusion project that the government of India undertook in 2015 and biometric identity were two important pillars which were also mentioned in the previous point. session uh, but apart from that, what India did was to sort of avoid over-reliance on the public sector or the private sector to achieve this, it was a marriage of public sector processes and private sector initiative, public sector regulation and private sector innovation. were the ways in which this public digital infrastructure was built and some of the advantages of being relatively latecomers compared to the Advanced Nations is being able to avoid the mistakes that they made and one of them was making sure that wasn't the case. be developed in a way that was exclusionary in nature, it was inclusive because it could, it had to cater to all wallets and all sizes and therefore that's why it had to be an open architecture, it had to be affordable and it had to be accessible to everyone. people and even in remote places where the communication infrastructure may not be very advanced, so these were all things that were taken into account and these are the aspects of India's public digital infrastructure rollout that would be extremely relevant to many other nations, as well as for the Internet if Maybe you could expand on what Anand said in terms of how you see digitalization as a tool that developing countries could use to anchor strong and inclusive growth learning from the pandemic, of course, and and to the efforts made by some countries learning from countries. like India deploying its safety nets in a better way that would further support mitigating the impact of crises on the poorest of its populations, has of course underlined the power of digitalization that can help countries achieve better outcomes for reach broader segments of the population. to their populations in a better way so certainly a lesson in public financial management, of course.

A lot can be done to strengthen revenue management by using more digital processes and improve revenue mobilization from that, so think about that and of course that gives governments the ability to expand the fiscal space that they can. use to address the needs of its poorest segments, so that the power to both expand income and to make better use of income, of course, to have more targeted social programs. safety nets that reach the poor more effectively, I think one of the lessons that we also take away from India and how it was able to really maximize its already considerable digital capacity to respond to the pandemic, if it could respond if it could . ask in the case of Bangladesh, you know that recently the Grotes loan has loaded the question is: how do you see the Indian example on digitalization as a role model for countries in the region or even, in general terms, how do you see the role of digitalization in Bangladesh? good afternoon everyone and thank you very much, of course digitalization would help us a lot and we visualized it in our first prospective plan of Bangladesh from 2010 to 2021, we put the motto as digital Bangladesh and in terms of development budget we put huge investment in the development of the IT sector in that way.

I must say that we have lost a lot in terms of politics and we know that India hasdone very well in that sector and we are also emphasizing a lot that we have at least fifteen thousand outsourcing entrepreneurs in Bangladesh. So I think it is a large number and that has been possible thanks to the inspiration of the government. We established what were called IT training centers, digital parks and IT centers at each secondary level of the school, so we realized that it is a potential sector that we can go into. I emphasized the infrastructure sector in Bangladesh as a whole, so that you know that we had entered into the mega project.

It was the era of the megaproject. In Bangladesh we have 10 assistants to large mega projects. We have been implementing and one was Padma. Please, we already integrated it last June. We have already introduced the Metro train or Sky Train in Bangladesh and we will introduce it in the next month or at the end of this month or in the next month, a tunnel under the river in the corner, which I mean in terms of infrastructure construction, we had a lot . of Lucas hinterland in infrastructure requirements, you know, we started building ports, seaports, we developed our seaports which are in operation now, we created a big road network, we made all the highways and district roads and you know, iOS has six full length lanes, so all of that has been to address the inadequacy of infrastructure and allow economic growth to emerge and allow business entrepreneurs to go with business, so we emphasize, you know, quite a bit on the IT sector, I should say, and the last, yes, last financial year and the last last June we exported or more than a billion, I know, in IT services and exports without IT related services.

Thank you Governor, from your perspective as central bank governor, how do you see digitalization? You know, helping countries in the region and elsewhere to unleash inclusive, long-lasting and strong growth. I mean one aspect of course, international inclusion, would you like to talk a little bit about how? You look at it from the central bank perspective, yes, obviously, let's see. I mean, the big example is obviously what India has done and we're trying to learn and, you know, get the social advantage of this digitalization when it becomes the Central Bank. There are two areas. One is payment settlement and digitization and making payments much more efficient and a settlement infrastructure that can reach the bottom of the pyramid in terms of offering social safety nets and financial inclusion and even more so than areas like, for example, the payment of taxes. uh, you know, minimizing tax evasion and other customs revenue access to all these areas, basically, I think this is where digitalization can play a big role in one of the problems. uh, I think K1 is provided with a digital ID.

I think this is where In Sri Lanka, what we are trying to do is roll out utilization in the financial sector in the first quarter, especially given the new ml security regulations and national digital IT and link that for financial services, I think it's the turning point, that's where we are. We have come a little late and we are trying to implement once we do, this cannot be, this can be the very useful instrument which can link all the financial transactions which will help the financial inclusions and will help the finances. literacy and services in all areas and that will obviously improve the efficiency, the productivity that we are talking about in the book, we talk a lot about digitalization and other areas are obviously a core pandigital current that I think we are not there yet . but we will take a close look at what the RBI is doing and that is why I think the next phase of, you know, kind of a game changer in terms of digitalization, is a nationalized digital ID and then its application across all service areas. financial as well as the provision of social safety net government services, all of these things plus the CBDC is the next level.

I think that's where I see the value of that in terms of its use. Thank you Governor Adhikari from her perspective as Governor of Central Bank of Nepal. How do you see the role of digitalization? Yes, thank you, thank you, Mr. Director, let me quickly take a minute to extend my courtesy and seize this opportunity from the beginning. I would like to thank and congratulate the entire team involved for this outcome of the South Asian Resilient Growth Path related documents, I think it is really very useful, a reference document for all of us at the same time.

I would also like to thank everyone who joined here, let me quickly mention the Nepal case, kovid in fact was the first case was observed in January 2020. The total number of deaths was around 12,0019 till now and the total number of positive cases detected is around 1 million thanks to the serum from India, the regional region of this region, one of the main institutes that has produced vaccination and a while in the first instance also to Nepal and we can recover from kobit at an early stage with your support and I would like to extend my gratitude to all the scientists and the team involved in who on this occasion allowed me to move towards our vaccination rate is far above the global average, it is almost 95 97 of the population over 12 years old.

Let me move towards your question regarding digital digitization, we consider it as one of the key means, an instrument for financial inclusion, it is also one of the key means to prevent activities similar to money laundering, it is also the instrument to combat corruption, it is also useful to promote transparency, ultimately it improves the cashless society and improves the governance of the society if seen within these two and a half years of the kovid period. The progress in Nepal and digitalization is truly remarkable. The growth if you see that it is almost 300 percent of many retail value transactions and even rtgs you can see that the transaction value is significantly good, so we are very satisfied. encouraged with the progress um and we hope to develop more uh in the pricing structure that I need and we also hope to have a cross border mechanism with the exchange with India uh yes use in infrastructure new mature structure like India UPI with the related private sector of Nepal and the infrared structure related to the government so that this morning or this afternoon we talk about border crossing, tourism, etc., that will be even more fascinated, we take it positively, we encourage a lot, we promoted this digitalization during this period of greed , thank you very much, clearly, this is a turning point for most countries and, in terms of ensuring growth in the future, both in terms of strong growth and inclusive growth, there is a lot to learn, a lot that we can take from the digitization.

I would like to move on to a different topic, we talked this morning about the whole issue of the risks of geoeconomic fragmentation and you know we have done a little bit of work at the IMF on this and clearly there are risks and it all started with one could say I mean that There is no starting point, but if you think about the US-China trade war from there to what happened during the war in Ukraine, you will see that the risks of fragmentation increase. Anton, if I could ask you to talk a little. a little bit about how they see this from a multilateral perspective and then I want to hear from all the panelists how they see that, both in terms of the region, how the risks of a geodome fragmentation could be mitigated and how we could actually avoid it altogether. in terms of promoting materialism, so if you could start with that and you want to be great, yes, thank you Krishna, as I outlined this morning again in the opening remarks that I made, of course, this is a step towards fragmentation and increasing fragmentation that we are seeing, even before the war in Ukraine, but certainly since then, is a major concern for an institution like ours and we consider ourselves to have a very important role in reminding the international community of the great value of free trade that has helped many countries lift millions of people out of poverty over the course of the last two decades and specifically in this region where it has been a key driver of growth. and poverty reduction, so we have to work with our member countries, of course, to find common ground in their trade disputes.

We understand that countries rightly have concerns about security issues, and sometimes then proceed to believe that trade restrictions can help. they address those issues that certainly, while they value the need to ensure the security of individual countries, it is a very costly way of seeking security and I think some of our analytical work is increasingly part of what Krishna outlined non-specifically. Addressing that question, but certainly making very clear what the cost of further fragmentation is to the global economy, can go a long way. I think that in finding ways to resolve crises, we have focused our specific attention on doing more work in our institution on trade. issues in recent years, with the view as well, so I also lay out some of those costs and benefits and remind the world of those benefits, and I think we are certainly making progress on the call.

The authorities of our country in the context of the

discussion

s that we have had during the annual and spring meetings focused on those areas where they are very clear, clear, a clear justification for resisting fragmentation and doing better. One of the things we've seen, of course, is that countries largely recognize the need to, you know, Global, to work better together on global public goods and combat the climate. change, for example, we have made the case and can continue to make clear that it is absolutely inconsistent to think that you can work collectively on a threat like climate change while isolating yourself from the rest of the world and putting current trade restrictions in place is not a consistent way to address an issue of global concern, so those are some of the things we can do to better highlight the risk of fragmentation.

Thank you, Mr. Allegation, how do you see the risks? of geographical fragmentation, we are exaggerating it, but if the risks are real, how do you see the region facing them? Is it a challenge or an opportunity? So if you could talk about that, I like the phrasing of your question about whether it's a challenge. or an opportunity, I think it's a realistic thing, actually, um, I mean, this is a Friday night and I think I'd like to leave the contestants with something to chew on when they leave, so I'm going to take a philosophical stance in general, uh.

I think countries and people also tend to be generous when things are going well for them. Prosperity means trade integration openness to immigration openness to trade everything happens automatically and people don't feel insecure that applies to both immigration and actually, and I mean, I used to live for 22 years in Singapore and, in 2011, After the national elections there, which created a ripple effect in that country, attitudes towards immigration began to harden and thresholds were progressively raised. and benchmarks and minimum rates of profitability were established to allow immigration, etc., and we are talking about a small open economy that naturally thrives on openness and there are circumstances that force them to think about imposing some restrictions for considerations that they consider It's quite legitimate, so my point is that these things tend to arise in Cycles, whether we like it or not, I think there is no universal prescription that we can adopt and that would be theoretically desirable, but I think it is practically not feasible, the benefits of the integration.

They are best done in times of fragmentation and during times of integration we also realize their disadvantages and that is that between 1945 and 1970 there was growth led by the government and then, from 80 to 2020, there was basically globalization and led markets. growth etc, and this will and then the balance of power shifted between labor and capital, now the pendulum will swing back and along with that will come issues of fragmentation and national considerations in terms of immigration etc, in my opinion these They are inevitable cyclicals. processes that we can implement with our hands, but we can't do much about it, so now, coming to your question of whether it is a challenge or an opportunity for this region, I think in general, with the nations represented here. on the table, including India, would see this as an opportunity for them to jump on the bandwagon of global trade that they weren't really a part of before and that needs them to improve their technology, their investment in research and development and their and their capacity to think about the education system in preparing them for the future, all those things will actually give them opportunities to grab market share, so that when the pie is growing for everyone, there will be no need to worry about market share, even if it is constant. youpredictable since '91.

They have no objective for that, while we can. go 16 times on this and probably one of the countries is Pakistan so apart from Sri Lanka in the region it has happened like this and that's why other countries shoot those who are looking at these things. I think one thing is that this is basically uh This is an important message to all countries about strong institutions. I think this is an important issue, it is the basis for stable, inclusive and sustainable growth over long periods without entering a debt crisis. Now it is an extended crisis. There is potential and where there is a supreme crisis.

Physical imbalances. all of these things, I think this is where I think I can share our experience, it's a test case and then we can see the impact, plus, you know, the loss of production from various decreases that it will take for us to come back to this. the situation that everyone can learn on the Internet F on this point, the governor made some very revealing comments on how things have gone backwards in Sri Lanka, how a country protects itself against these slides in terms of loss of fiscal credibility, monetary credibility, credibility institutional, etc. Yes, I know you've been a minister for a while, but from his perspective, how do you see this?

How is the country addressing this problem of slipping? No I I found myself nodding in agreement to the comments the Governors were making about the importance of strong institutions. There is no doubt that they play an enormously important role in mitigating the impact of tendencies to undo reforms and change directions that are very detrimental to countries, but I would say that, in addition to strong institutions, strong leadership is another piece, a very important piece. On the ladder there is not much that the fund can contribute, but in institution building we certainly have a very important role in the form of our policy advice, but also more.

The most important thing is perhaps in the form of the development support capacity that we provide to countries to help them build strong institutions, but our conclusion really is that the real result of having strong institutions as a result of providing technical assistance and training has been a lot to do with ownership and it has a lot to do with strong leadership to ensure that when people are trained to manage their debt properly, they have a say in decisions about what debt to take on or not to take on and we have experiences where The fund has invested significantly to help train officials who have been absolutely ignored when it comes to things that they know more about than those who make those decisions, so those are aspects of weak institutions as well, but also weak leadership.

I think there's not much the fund has to do about the issue of weak leadership, but we can certainly help civil society ask tougher questions of their leadership and we can do that by sharing more information and then being more transparent by helping countries to be more transparent. about publishing data and how they manage their budgets, educating parliamentarians about some of the costs of bad political decisions and our analytical work and our political advice can be very powerful in those circumstances, I know from my own experience that they can strongly support reformers who want to change things, so it has to be a combination of the country's own decisions to move things forward, enabled by a more educated public.

That raises more difficult questions, as well as, you know, focused on the capacity building and support from institutions like us that can help countries achieve that goal, so I will stop there, Krishna, look at the very important thing, thanks to the great Points Center, Minister. From his perspective, the role of institutions, what can countries do to not neglect the progress they have already made? I think the question is very pertinent, particularly given the very good book that the Fund published today. All issues were discussed. in detail in this book and using a lot of evidence and I think it is quite convincing in this book.

I thank the editor and I thank those who published it about institutions, of course, institution is important for growth and development, but institution as such is impersonal, you know? a person running the institutions that work with students is important if you have trained manpower, if you have quality human resource institutions you will certainly do well, so it is a good link, so not having good institutions , I mean in terms of performance. We need to have quality human resources, which is the basic ingredient and I think the most important ingredient for that. We need to improve the quality of our education, particularly in Bangladesh.

No, in terms of quantity, educational infrastructures expanded greatly. We have 104 private universities, around 50 public. universities, no, that wasn't much before 2010, our literacy level, you know, increased very inevitably in every way, it was only 65 percent literacy in terms of, you know, those who are up to 15 , so in terms of you know, literacy means signing, ah and reading newspapers, books and being able to do some calculations, some or some mathematics that they can use, so the literacy rate is 75 in Bangladesh now it was not 10 percentage points highest in a decade, so what I mean in terms of, you know, amount of our education.

The system expanded quite a bit, but the big question now is the quality of education and for quality people you need quality education, then you will also have a good institution, so I think you should emphasize the law, she says, Internet has said that, of course, strong leadership is needed. Strong leadership is needed for good corporate governance, but only strong leadership may not be useful unless you have quality. Quality of workmanship. There are no people. So I think not. I know very well the importance of institutional economics. Those countries that did well in the past. You know, strong institutions, there's no doubt about it.

Regarding institutions, I say that this is closely related to the quality of human resources, so both education and health services, I mean both, and for that you need quality public spending, so if you have a quality public spending. spending, you may not face any debacle if you have potential macroeconomic policies, your economy may not fail in many countries. Even in our region, you know you have a higher illiteracy rate, you have no life expectancy, higher education, higher literacy, I mean, and hammer it home. Suddenly you know I should say face the debacle, uh, how do I put it, in this covert situation or after the greed or the war in Ukraine, so this is because your higher pocket income, your higher literacy, your higher human quality, they can even crumble into one or two big ones. errors in their macro policies, so it is proven, so I think that to have a good macro policy, it is necessary to talk well, there are no macro policies with good human quality and, in the case of Bangladesh, I can tell you why so many know the dark areas of which we have no doubt.

There is no doubt that we do not have a low fiscal GDP, but in many cases we did well due to our macroeconomic management potential. Generally speaking, I have to say that's why you see in the management of greed that it was a big shock to the economy, we sure didn't do it. See it before it comes, so Bangladesh is the number one country in South Asia and handles the greed situation. This is said from Japan Institute so it is not our saying and it is 15 Bangladesh 15 World in successful handling of kovid so our macro policies are ours. rapid intervention we don't know how to manage the situation incentive programs that involve uh involve medium small medium enterprises micro enterprises The producers immediately came with a program that was quite timely and thoughtful, so not Bangladesh, I should say when many countries in the region also faced negative situations Growth: We had more than 3.5 percent growth in the second year of Kobe, we grew by 6.5 percent and this year we expect our growth rate to be no more than seven percent.

I can say that although I am a fan of predictions, As far as I can remember, 6.8 percent, so it would be more than that because we relatively have well thought out macro policies, although we have gray areas. I also have to agree, like I said, low tech gbd ratio, so thank you very much, thank you, we have about five. Minutes left for questions uh anyone ask questions from the audience yeah okay thank you very much for such an insightful comment. I'd like to ask Antoinette or Krishna about what kind of role Clay industrial policy plays in this

path

to

resilient

growth. because this industrial policy was started from China, uh, you know China did in China 2025 and then also India introduced, you know, this brand in India, but now what we are witnessing is that it is really led by the United States, you know all the facts. in the US and also recently, chips and science, you know, 52 billion dollars and also this inflation reduction of 369 billion dollars and then also the European Union is trying to introduce this industrial policy, their version of this Internet policy, so what we are witnessing as one that is also paradigm-shaped, is really a kind of global competition for this industrial policy, so, according to this, you know, the conventional consensus of Washington had reservations about this role of industrial policy, so how do you see this, you know, in this changed world? role of industrial policy I would say that, you know, one has to look at the details, of course, because one can characterize industrial policy in different ways.

I mean, people understand them differently, but certainly our view that They are not the best contributors to maximizing the benefits of open trade, for example, has not changed and that the protectionist measures that some countries are now implementing are justified in very different ways in different places. They are subject to the same limits in terms of what they believe they can achieve for themselves and certainly the adverse impact they can cause on others, so I wouldn't say that the world has changed in such a way that the drawbacks of industrial policy are looks very different today than before the pandemic and also before the war in Ukraine.

Yes, yes, please, I just don't comment on the Washington Consensus, as you mentioned, actually, as I remember, it was announced in 1989. The Washington Consensus after the IMF. you know the structural framework then came in the Washington consensus so Bangladesh followed my government where now I am the cabinet minister minister of state so we follow Washington Also why do I say it because Washington's concessions you know I emphasized liberalization you know minimize the positive deficit you know all this then Having all this in the 90s, the second time common came to power after 15 years in 1996, so we followed the concept of Washington and why I say more because we incorporated there the principles of the Washington consensus and the emphasis on social welfare and the emphasis on competition between companies.

We encourage competition as much as possible, especially in the telecommunications sector, so Bangladesh rightly does not capture the Washington Spirit consensus. In addition, we emphasize the emphasis on social welfare, agriculture, we generally provide subsidies that gave great results in the period 1999-2000, for the first time we assisted. food order key so thank you very much any other questions yeah the back no questions actually a couple of thoughts when you look at the title of this high level policy roundtable we're not lending a lot of attention to resilience. I think that is particularly important because what Kobe itself was a shock and the countries showed resilience if we take a more recent example: in March last year, India was promoting the export of wheat of which there are also 60 million tons in the warehouses that I officially wanted to export, so March became one of the hottest years. in 100 years and the crop forecast changed immediately there was an export ban and that had a domino effect on the global food market so these are serious problems how do we address those problems in terms of building an institution and how can we finance aid?

Those types of investments, that's my first comment. I think it's just food for thought. A second comment from the honorable Minister. Professor Alan's comment that the set of beams can be a frame. I heard about it in the previous session and we have also been trying to work with bimstec. As an institution, this is the Gulf InitiativeBengal for multi-sector technical and economic cooperation, very voluminous, so they are an institutional capacity, not that there are great potentials, if this can be a fantastic platform for regional integration, it can be a platform to cooperate. with ASEAN for example, as most of you know, South Asian countries trade less with each other than they do with ASEAN countries, so why I mean you're wondering why it should be that way?

Basically, it's about getting back to policy fundamentals. You know, in foreign policies there is also fragmentation at that level, let me give you an example. Import of agricultural machinery to India. I think if I'm not mistaken the import duty is 30 percent, for Bangladesh it is 3.5 percent so as a result it is very different despite being a lower level mechanization level in Bangladesh, it is the highest in South Asia because of policies, these clearly have a political impact. I had one more idea, but I skipped it, so thank you very much, it's night, thanks for those wonderful ideas, yes please. no, thanks for those thoughts and I wanted to go back to the first comment you made and disagree a little bit with your conclusion that the panel hasn't paid much attention to resilience.

I think there's an aspect of resilience that we've talked about. It's about quite a bit and that has to do with, you know, making macroeconomic policy more effective and institutions stronger to help countries, you know, deal with anticipated shocks, that's a big part of resilience. . I don't think we've talked about that enough. So far it is the issue of climate, of course, and resilience to climate impacts and the fund has been paying absolutely great attention to this issue, as you will have seen in all areas of the analytical work that we are doing and the focus on climate issues in our monitoring work in our article 4 reports the development of the financial industry's first long-term government in the fund, the resilience and sustainability trusts to provide financing not only to our low-income member countries but also to our middle-income countries that need it. support to address climate challenges and we have already implemented some of those support pieces in the pilot countries.

Bangladesh will be next on January 30 and we really want to support a country that has already done enough in that area and that needs more support to move forward, but you are right that we have not discussed that enough on the panel until now, but I just wanted to add that resilience has several dimensions and the What we've talked about quite a bit is the previous thing that I described thank you, of course, of course, understood, thank you, in fact, I apologize because that was a question that was going to do, but we ran out of time on the weather.

We have done a lot of work, in fact, very soon we will publish a document that analyzes the whole issue of resilience, climate risks and so on from the point of view of public perception, how does the public perceive the risks of climate change? How does the public view trade-offs and policies, etc.? We've done a lot of work on building resilience in the context of climate, but again we ran out of time, so I apologize for that, but we have One minute, one last question before we try to summarize: Yes, foreigner. Do you think decoupling could be a problem?

Or perhaps, as countries are considering decoupling from China, do you see it as growth or an impediment to growth? Thank you so much. Again we've done some work on decoupling and the issue is any type of thing, whether it's fragmentation decoupling, the losses are significant and, again, you know that when you try to exchange efficiency gains of others for other types of gains, nobody wins, so that's part of the work that we've done, we've done some specific work on technological decoupling, which was a point a while ago, again, the losses are quite a lot, everyone loses on this, so there are short-term risks coming from China and, uh, I know, but we should put this in a broader perspective.

You know that China has been a major player in global value chains. It has been a major factor in further trade integration, etc., so there could be some short-term risks. What's happening in China right now and people are magnifying it, but you shouldn't throw the baby out with a butt, and in that sense I think it's important to recognize that any kind of decoupling fragmentation or almost showing things like that has costs. they are quite significant and Asia in particular will lose a lot more, that's what our work has shown because it has been a more integrated region than the rest of the world, so the risks of this are much higher for Asia.

Normally if someone wants to add an antenna you won't add anything about that but that's okay I think we're out of time here but today we had a good discussion we talked about some aspects where clearly there are winners in digitalization where India has done a remarkable job and that could be a way for other countries to follow. There are benefits in terms of how we see strong, sustainable growth anchoring post-pandemic. We talked about the risks of geothermal fragmentation and there was broad agreement that the risks are significantly high and that the world should. Moving towards greater integration, of course, public policy needs to do a better job of trying to highlight what the gains and losses are and, in a sense, making sure that the losers don't lose too much and thus compensate for that, so the role of public policies there There was a whole question of resilience and you know the role of institutions in anchoring sound macroeconomic management and I think the government raised some very important points in saying that one must protect against the risks of moving away of the progress he has made.

I think you know you raised a very important point. I think it's an important lesson for all countries, so if you consolidate your achievements and move forward, don't go backwards. I think the role of institutions there is extremely critical. whether it's macro, whether it's fiscal or monetary, uh Anthony made a very important comment about the role of leadership and again he goes to the point again of leadership and ownership when the governor said he's had 16 programs with the IMF, why would it be program number 17? more successful again, it all speaks to the fact that any type of reform of ownership and leadership is very important, we talked about transparency and again the minister talked about the importance of education and skill levels that can anchor many things with their leadership or ownership and finally the quality of public spending, which again was an important factor.

We don't address climate change, but believe me, we are working hard on it and the first thing Anthony talked about is truly an innovative instrument of the IMF. it's a long um it's the longest in terms of tenure 20 years 10 and a half years Grace IT addresses the issue of climate change and pandemic preparedness and is also an important tool to catalyze financing not only from the public sector and from others IFI, but mainly from the private sector to address the problem of climate change risks, so we had a very good discussion. I would like to thank our panelists, Mr.

Nagin, for leaving early, but thank you Governor, yes, thank you Governor, thank you Minister and thank you Anthony. Thank you very much for your time and for being here and thank you all.