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I am thankful to the Banque de France for inviting me to the international symposium on Productivity, Competitiveness and Globalisation to enable me to share my thoughts on financial stability. I intend speaking on the possible implications of global imbalances for the emerging market economies (EMEs) with special focus on India.

Although fast growing economies are generally grouped together as EMEs* , some of their major macroeconomic indicators present a wide spectrum. While some of the EMEs are running large current account surpluses (such as China, the Russian Federation, South Korea, Venezuela, Malaysia, Taiwan and Brazil), some others are running current account deficits (such as Turkey, Hungary, South Africa, Mexico, India and the Czech Republic) and their current account balances range from a deficit of US$ 20 billion to a surplus of US $ 69 billion. While savings rates for select EMEs range from nine per cent to 43 per cent of the GDP, in most of the EMEs the rates have increased and overtaken those of the industrial countries, with particularly high savings rates in China, Malaysia and Russia.

Likewise, while some of the EMEs have fiscal surplus (Russia), several others have fiscal deficit (Turkey, India, the Philippines, Argentina and several other EMEs). Also, while some of the EMEs such as India are largely domestic-demand driven, some other EMEs, particularly in the East Asia (Malaysia and the Philippines) are largely dependent on exports to sustain their growth and their exports of goods and services range from 15 per cent to over 120 per cent of GDP. It is useful to note that while some of the EMEs are net oil exporters, some others are net oil importers