OECD

The roots18 of the Organisation for Economic Co-operation and Development (OECD), Paris, go back to the rubble of Europe after World War II. Determined to avoid the mistakes of their predecessors in the wake of World War I, European leaders realised that the best way to ensure lasting peace was to encourage co-operation and reconstruction, rather than punish the defeated.

The Organisation for European Economic Cooperation (OEEC) was established in 1947 to run the US-financed Marshall Plan for reconstruction of a continent ravaged by war. By making individual governments recognise

the interdependence of their economies, it paved the way for a new era of cooperation that was to change the face of Europe. Encouraged by its success and the prospect of carrying its work forward on a global stage, Canada and the US joined OEEC members in signing the new OECD Convention on 14 December, 1960. The Organisation for Economic Co-operation and Development (OECD) was officially born on September 30, 1961, when the Convention entered into force.

Other countries joined in, starting with Japan in 1964. Today, 35 OECD member countries worldwide regularly turn to one another to identify problems, discuss and analyse them, and promote policies to solve them. The track record is striking. The US has seen its national wealth almost triple in the five decades since the OECD was created, calculated in terms of gross domestic product per head of population. Other OECD countries have seen similar, and in some cases even more spectacular, progress.

There are many countries that a few decades ago were still only minor players on the world stage—China, India and Brazil have emerged as new economic giants. Most of the countries that formed part of the former Soviet bloc have either joined the OECD or adopted its standards and principles to achieve the common goals. Russia is negotiating to become a member of the OECD, and now the organisation has close relations with Brazil, China, India, Indonesia and South Africa through its ‘enhanced engagement’ programme. Together with them, the OECD brings around its table 40 countries that account for 80 per cent of world trade and investment, giving it a pivotal role in addressing the challenges facing the world economy.

India & OECD: India has got ‘enhanced engagement’ (since 2007) with the body ‘accession’ (membership) to it is distinct—though it has potential in future leading to it. The accession process to it is complex and longer as it involves a series of examinations to assess a country’s ability to meet its OECD standards in a wide range of policy areas. Meanwhile, India’s relationship with the OECD has developed steadily since 1998 (when it joined its Steel Committee)—since 2007 being its ‘Key Partner’. By early 2017, India used to participate as an Associate or Participant in 21 OECD bodies and adheres to 9 OECD legal instruments, making it an important contributor to several areas of importance—from corporate governance to fiscal matters to nuclear energy. Furthermore, India plays an active role in

OECD’s regional activities in Asia together with co-operation on various international fora.