The International Monetary Fund’s Managing Director, Kristalina Georgieva, has emphasized the importance of an inclusive approach to the Biden-led rail-to-sea economic corridor connecting India with Middle Eastern and European countries. Georgieva believes that the initiative should not be exclusionary and should instead embrace the spirit of an integrated world economy.

The rail-to-sea economic corridor is seen as a response to China’s influence in the Middle East and its Belt and Road global infrastructure initiative. However, the global economy has become more fragmented, leading to limited global trade growth compared to global economic growth.

Georgieva stated, “If we want trade to be an engine of growth, then we have to create corridors and opportunities. What is important is to do it for the benefit of everybody, and not for exclusion of others. In that sense, I would encourage all countries working collaboratively with each other to do so in the spirit of an integrated economy.”

During a leaders’ summit, U.S. President Joe Biden and Indian Prime Minister Narendra Modi unveiled a plan to develop a network of railways and sea routes connecting India, the European Union, and Middle Eastern countries such as Israel, Jordan, Saudi Arabia, and the United Arab Emirates. The aim of this “transformative regional investment” is not only to strengthen the partnership between India and the U.S., but also to present themselves as a more viable strategic option for the developmental needs of the Global South.

The proposed economic corridor builds upon existing infrastructure investment in the regions involved. Georgieva highlighted the importance of connectivity, stating, “In a world where we learned from Covid and the [Ukraine] war, that supply chains need to be reinforced, they need to be diversified, that connectivity matters tremendously.” She believes that increased investment in infrastructure connectivity creates a platform for trade among nations, benefiting both the countries involved and the world economy as a whole.

Georgieva’s comments came at the end of the summit, where Russian and Chinese opposition almost jeopardized a joint communique among G20 member states. The Delhi Declaration, eventually adopted, pledged to protect the most vulnerable in the world and promote equitable growth and financial stability.

Among the issues discussed at the summit was multilateral bank reform, including the establishment of a global framework to restructure sovereign debt for developing economies. The IMF warned that the economic recovery after major shocks is slow and uneven, with weak growth prospects in the medium term.

Georgieva called on members to strengthen the global financial safety net and announced that the IMF has provided significant support to countries during the pandemic, injecting $1 trillion in reserves and liquidity. The IMF is currently undergoing its 16th quota review to meet the financing needs of member states and enhance the Fund’s interest-free support to the poorest countries through the Poverty Reduction and Growth Trust.