India supports reforms to the international financial architecture to enhance inclusivity and equity, including MDB (multilateral development banks) reforms and "fairer credit rating systems," Finance Minister Nirmala Sitharaman said on Tuesday.
"MDB lending must be aligned with long-term development goals and backed by robust monitoring frameworks to ensure that funds are used as intended," Sitharaman said while speaking at 4th International Conference on Financing for Development (FFD4) Plenary meeting in Spain.
"We support international cooperation to modernise tax systems and curb illicit financial flows. India’s comprehensive tax reforms and digital transformation in tax administration have increased revenue and reduced compliance costs," said the FM, adding that the Indian financial system promotes inclusivity through easier credit and lower compliance cost, especially for MSMEs.
The FFD4 is an UN anchored platform to discuss long-sought financial architecture reforms and to push for investment in the Sustainable Development Goals (SDGs). "With many SDG targets off track and a financing gap exceeding $4 trillion annually for developing countries, the need for urgent and transformative action is clear," Sitharaman noted.
"India emphasises the importance of a comprehensive, equitable, and development-oriented global financing framework—one that respects country circumstances, preserves policy space, and delivers on the promise of sustainable development for all," she said.
The FM also stated that India has consistently placed people at the centre of its development strategy. "Through targeted policy interventions, we have lifted 250 million people out of multidimensional poverty, and empowered communities through inclusive digital public infrastructure. However, for robust global growth, national efforts must be complemented by an enabling international environment," she added.
Sitharaman further urged developed countries for enhancing climate finance that is predictable, accessible, and concessional—particularly for adaptation in vulnerable countries. "We note that sovereign debt has become a structural barrier to inclusive and sustainable growth for many countries. The Global Sovereign Debt Roundtable, launched during India’s G20 Presidency, has played a pivotal role in enhancing debt transparency and comparability of treatment in debt restructuring. Going forward, effective implementation of the G20 Common Framework coupled with preventative debt management, is essential," added the FM.
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