30.08.2025

International Monetary Fund (IMF)

Context

• Former RBI Governor Urjit Patel has been chosen as India’s Executive Director at the IMF.
   
• He succeeds K.V. Subramanian in this role.
   

What is the IMF?

The International Monetary Fund (IMF) is a global financial institution that helps countries facing economic imbalances or crises, ensuring stability by offering policy guidance and financial support.

Formation and Origins

• The IMF was formally set up in 1944 at the Bretton Woods Conference in the United States.
   
• Alongside the World Bank, it came to be known as a “Bretton Woods Twin.”

Membership

• The IMF today has 190+ member countries.
   
• India joined as a founding member on 27 December 1945, even before its independence.
   

Core Objectives

1. Promote stability in global monetary and financial systems.
    
2. Provide timely policy advice and funding assistance to members in distress.
    
3. Help struggling economies rebuild confidence, sustain growth, and prevent contagion.
    

Flagship Reports by IMF

• World Economic Outlook (WEO): Offers analysis and forecasts of global economic growth and challenges.
   
• Global Financial Stability Report (GFSR): Highlights risks in international capital markets and banking systems.
   
• Fiscal Monitor: Reviews fiscal health, public debt, and government finances worldwide.
   

India and the IMF

• India is a significant member with voting rights and active participation in IMF decision-making.
   
• It has received funding for development programs and contributes to shaping global financial policies.
   

Conclusion:

The IMF remains a cornerstone of the global financial system, offering stability, guidance, and funding. India’s active role, from being a founding member to holding executive positions, highlights its growing importance in shaping international economic policies and cooperation.