Nirmala Sitharaman, Finance Minister
“This concern has been actually acknowledged by several members of the G20 saying yes money trail, yes money laundering, yes drug misuse, and so on. There is an understanding that we need to have some kind of regulation, and that all the countries will have to be true together on it, no one country is going to be able to singularly handle it. So on that we will certainly have something,” Sitharaman said
Washington:
India is aiming at developing standard operating procedures for cryptocurrency during its G20 presidency next year, Finance Minister Nirmala Sitharaman has said, underlining that all countries want the technology to survive but not be misutilised.
“That (crypto) will also be part of India’s thing (agenda during G-20 presidency),” Sitharaman told a group of Indian reporters on Saturday before concluding her trip to Washington DC to attend the annual meetings of the International Monetary Fund and the World Bank.
India will assume the Presidency of the G20 for one year from December 1, 2022 to November 30, 2023. Under its Presidency, India is expected to host over 200 G20 meetings across the country, beginning December 2022.
Sitharaman has been making a strong case for global regulation of cryptocurrencies to tackle the risks on money laundering and terror funding.
Noting that institutions, which are associated with the G-20 or the World Bank or any such organisation, are doing their own assessment and studies of matters related to cryptocurrencies or crypto assets, the minister said,
“We would definitely want to collate all this and do a bit of study and then bring it on to the table of the G-20 so that members can discuss it and hopefully arrive at a framework or SOP, so that globally, countries can have a technology driven regulatory framework.”
The G20 is an intergovernmental forum comprising 19 countries and the European Union. It works to address major issues related to the global economy, such as international financial stability, climate change mitigation, and sustainable development.
Sitharaman underlined that no one single country can effectively handle or regulate crypto in any form.
“But implicit in this is that we don’t want the technology to be disturbed. We want the technology to survive and also be in a position for the FinTech and other sectors to benefit from it.
“But if it is a question of platforms, trading on assets which have been created, buying and selling making profits and more importantly in all these are countries in a position to understand the money trade, are we in a position to establish for what purpose it’s being used?” Sitharaman asked.
She gave the example of the Enforcement Directorate (ED) detecting substantial money laundering, probably cases related to crypto assets and trading of assets, recently in India.
“This concern has been actually acknowledged by several members of the G20 saying yes money trail, yes money laundering, yes drug misuse, and so on. There is an understanding that we need to have some kind of regulation, and that all the countries will have to be true together on it, no one country is going to be able to singularly handle it. So on that we will certainly have something,” Sitharaman said.
In July, Sitharaman said the Reserve Bank of India (RBI) has expressed concerns over cryptocurrencies, saying that they should be prohibited as they can have a destabilising effect on the monetary and fiscal stability.
”In view of the concerns expressed by the RBI on the destabilising effect of cryptocurrencies on the monetary and fiscal stability of a country, the RBI has recommended framing of legislation on this sector.
The RBI is of the view that cryptocurrencies should be prohibited,” she said in a written reply to the Lok Sabha.
The RBI has mentioned that cryptocurrencies are not a currency because every modern currency needs to be issued by the central bank or the government, she told Parliament.
India is preparing to focus on several key issues like multinational development banks, debt situation and climate change during its G20 presidency next year, Sitharaman said.
During the just concluded annual meetings of the International Monetary Fund and the World Bank, the Indian delegation, including Sitharaman, briefed finance ministers and central bank governors of G20 countries on India’s priorities as the president of the grouping of the world’s major economies.
”In no particular order, I wish to say that we will certainly be wanting the G20 members to discuss how the multilateral development banks can better leverage the endowment that they have,” she said.
”Also, think in terms of getting other sources through which their finances can improve because one, they have to be more nimble in reaching out for development funding and two, they have to better effectively deploy the resources that they have.
”So that will certainly be one of the things that we will be working out and how that becomes an agenda point and how specifically we’re going to try to make it is subject to taking inputs from everybody,” she added.
Sitharaman said the debt situation is also likely to be on the agenda.
”I know solutions were arrived at during the pandemic, the sustainability initiatives. Now that period is gone. Now the vulnerabilities of more countries are coming out, many middle-income countries themselves are at high risk,” she said.
The common framework has not really delivered as much as it was expected to. So that will certainly be one of the issues that India would want the members to discuss during its presidency and have some kind of outcome, she said.
”Third, we’ll be talking about climate finance… we think a large part of this debate will have to be within the UNFCCC. So, environment-related issues should emanate from there. Certainly, there will be a role for the multilateral bodies,” she said.
Sitharaman is on a six-day visit to the US, which began on October 11. Besides attending the annual meetings of the IMF and the World Bank, she held bilateral meetings with her counterparts from several countries during the visit.
PTI