New Delhi: Prime Minister Manmohan Singh on Thursday urged the West to come to terms with the rise of India and China.

Addressing the London School of Economics Asia Forum here, he said the growth of these Asian economies will alter the balance of global income distribution but this need not worry the West since a dynamic Asia could power global growth and provide new growth opportunities in Europe and North America.

He said: "We need global institutions and global rules of game that can facilitate the peaceful rise of new nations. It also means global institutions and frameworks of cooperation must evolve and change to accommodate the new reality."

He felt this was as true for the reform and revitalisation of the United Nations and the restructuring of the Security Council, as it was for the management of multilateral trading system, or for the protection of global environment or for the security of world energy supplies.

"In the long run of history, nations rise and fall. This in itself is not a new phenomenon. Regrettably, though, the record of history is found wanting as far as the ability of nations to deal with such ebbs and flows of history is concerned," he said.

Dr. Singh said one of the reassuring aspects of the on-going growth process was that it was more orderly.

He described the rise of Asia as the most important development of the 21st century.

China has already trebled its share of world GDP over the past two decades and India has doubled it. Both these giant economies, he said, are bound to gain a considerable part of their share of world GDP that they had lost during the two centuries of European colonialism.

Japan will be on top

Dr. Singh predicted that while Japan will continue to be at the top in the foreseeable future, the newly industrialising economies of East and South East Asia will grow even if not at rates witnessed in the past two decades.

Referring to the role of Western academic institutions after the Second World War in facilitating peaceful post-war reconstruction, he urged institutions like the LSE to ponder over how the world can accommodate the growth aspirations of the developing world.

"For example, while there is enormous, and quite longstanding literature on the benefits of free trade in goods and free flow of capital, the literature and policy on the free movement of people remains scanty and patchy," he said.

Dr. Singh highlighted the unsettled questions pertaining to the globalisation of lifestyles, and its consequences for consumption, and their impact on the world environment.

"I believe, a new generation of economists and social scientists have to once again write and draw on blank slates, like IG's (I.G. Patel) generation did," he said.

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