India says 'difficult' to appoint non-European to IMF

India has conceded there is little hope of an emerging market candidate being chosen as head of the IMF unless the election process is changed to reflect "the new economic realities".

French Finance Minister Christine Lagarde has emerged as front-runner for the post, receiving wide European backing, after Dominique Strauss-Kahn quit following his arrest in New York on charges of attempted rape, which he denies.

Emerging economies have been pushing for the job -- traditionally held by a European -- to be opened up to their candidates, citing the growing economic clout of developing nations.

But New Delhi's IMF representative Arvind Virmani told India's NDTV news channel in remarks aired Wednesday that change was unlikely under the current set-up.

"Unless the voting shares which various countries hold in the IMF are changed to reflect the new economic realities, it is going to be extremely difficult for any non-European candidate to win the election," he said.

Currently, European nations hold close to a third of the voting power at the International Monetary Fund while the United States has nearly 17 percent. Asian nations hold around 20 percent, with the rest held by other countries.

India's Premier Manmohan Singh on Wednesday urged developing nations to "stand united" in seeking to transform the power structure at the IMF and its sister organisation, the World Bank.

He said at the India-Africa trade summit in Addis Ababa that "those who wield power (at the IMF and World Bank) do not wish to yield ground very easily".

Reform of global financial institutions had long been high on emerging economies' agendas but change was a "long process in which all the developing countries will have to stand united," Singh said.

Traditionally, Europe has named the head of the IMF and an American has run the World Bank.

The Indian statements came after the world's largest emerging economies, India among them, on Tuesday slammed Europe's push to retain the top job at the IMF, calling the continent's hold on the position "obsolete".

IMF directors from Brazil, Russia, India, China and South Africa -- the so-called BRICS economies -- said in a declaration that Europe's longstanding grip on the IMF leadership "undermines the legitimacy of the Fund".

Emerging countries are working to name a common candidate who "would have joint support", India's Virani said, but "the process is being rushed" by Europe, which wants to keep hold of the job.

The IMF has set a June 10 nomination deadline and wants to choose a new boss by June 30 as it seeks to deal with Europe's sovereign debt crisis.

Virmani said he did not accept European leaders' arguments that there is a "need for a European because there is a European (debt) crisis".

He recalled promises by Jean-Claude Juncker, president of the Euro group when Strauss-Kahn was chosen in 2007, that the next IMF leader would be from outside Europe and said the campaign for a European candidate was being seen by emerging nations as "a backward movement".

Mexico's central bank governor Agustin Carstens and Grigory Marchenko, who heads the central bank of Kazakhstan, are the non-European candidates who have entered the fray.

India has accepted that its own top candidate to become the IMF's managing director is ineligible because he is too old.

Senior Indian economic adviser and former IMF executive Montek Singh Ahluwalia was a fine candidate, Virmani said, but at 68, he was over the lender's age limit of 65 and out of the race.

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