India's clout at the International Monetary Fund received a further boost with the country giving $43 million to Indonesia.
According to finance ministry sources, buoyant foreign exchange reserves, which crossed the $100-billion mark recently, and a worthy balance of payments situation had encouraged the IMF to include India as one of the 40-odd countries in its financial transactions plan.
India had in the last eight months lent hard currency of $350 million to Brazil and another $5 million to Burundi under the FTP.
The latest package of $43 million takes India's hard currency share in its total quota to over $400 million.
Under the FTP, the IMF seeks volunteers from its members to contribute to other member countries' needs in cash. The FTP requires countries to maintain their hard currency component in the quota at around 25 per cent.
India has a quota of about $4 billion (or special drawing rights) in the IMF. Its contribution to the quota is largely in the nature of IOUs or issuance of government securities to the Fund.
While till 1990, its hard currency component was as high as 25 per cent, it had dipped to about 10 per cent following the financial crisis in 1990-91.
India had borrowed from the Fund in 1981-84 and 1991-93, and repaid the $ 2.5 billion debt a few years ago. The country is now a net lender which will strengthen its case for an increase in the membership quota in the IMF, in the next review in 2005.
The recent contributions to the IMF in hard currency have, however, raised this component in its membership quota, significantly to almost 20 per cent, sources said.
Countries like the US and the UK have a hard currency share of over 40 per cent. India is closing in on these countries, they added.
The sources said that India also gets a remuneration when it contributes in hard currency to the IMF.
It receives an interest which is over the London Inter Bank Offered Rate. The remuneration is higher than what its forex reserves earn by way of deployment in other avenues, they added.
