Even getting the meeting together was an achievement given the disparate range of interests. But it was a measure of how well those outside the industrialised West understood the gravity of the situation.

One suspects that many of them knew the history of capitalism better than some of the western host nations — they knew that it was failure at a similar summit in London in 1933 that led to the great depression. Then the collapse was the work of President Franklin D Roosevelt who rejected a plan to stabilise currency rates.

In the event that outcome appears to have been forestalled at least for the moment and a package of measures agreed that spells out the determination of world leaders to try and ensure that an already dire situation does not accelerate out of control for lack of consensus.

At the close of the meeting the leaders got their headlines trumpeting $1,100 billion of economic activity — there never was full agreement on stimulus  and the most that they could have realistically hoped for — a temporary pause in the downward spiral of gloom around the world.

But there was no substantive agreement on worldwide financial stimulus; on tighter regulation of financial markets or, more importantly, how any of the disasters that have befallen the world economy might be prevented from happening again.

But it is fair bet that though the Germans and French would not sign up to a stimulus package they will quietly go away and do much of it anyway — indeed in the interim the Germans have already been compelled to do so. For their part, the British and Americans were against throwing out some of the more innovative financial instruments with the regulatory bath water but they know that they must be brought under control.

Of the 'stimulus' figures trumpeted by the British Prime Minister Gordon Brown at the end of the meeting very little is actually new money: of the key commitment of special drawing rights to be made available through the International Monetary Fund (IMF) billed as a total of $250 billion, 44 per cent will be taken up by the richest members of the G-20 and only $80 billion will go to the middle income and poorer countries combined.

In other words, the majority of countries who will be hit hardest by the world downturn will get only a fraction of the support being made available. Even on trade finance, though the headline figure was $250 billion, less than $25 billion of that will be new money.

Overall there was actually no new funding committed at the summit for the IMF though the Chinese will join forces with Japan and the European Union in offering the first available funds should the need arise. Japan offered $100 billion last year and the EU $75 billion in March. The IMF organisation is offering a commitment of $500 billion of rescue money overall. Whether that assistance will be attractive to nations that have so recently been devastated by the IMF conditionalities that followed the Asian financial collapse of a decade ago, remains to be seen.

Or as Asia Times columnist Chan Akya put it: '…the tripling of IMF resources is astounding. The same people who drove the Latin American economy into dust and were responsible for widespread poverty in Asia in the aftermath of the Asian crisis; the very people who encouraged the idiotic accumulation of market-return independent foreign exchange reserves by Asian countries that subsequently caused the asset bubbles of the U.S. and Europe; the very people who had no clue about the impending bubble-burst up until the beginning of 2008 are now supposed to gather up the foresight and skills required to end an economic crisis whose only recent historic parallel was the 1929 depression in the United States; an event that took place a good 16 years before the IMF itself was created.'

In theory the IMF will stand by to prevent the hidden financial tsunami which threatens the stability of the European Union and of the Euro currency itself: the potential collapse of the east European economies.

Six of these states are already in IMF crisis programmes, Hungary, Latvia, Ukraine, Belarus, Georgia and Armenia while a further three are close to starting such programmes, Romania, Serbia and Bosnia. The crisis has already seen the collapse of governments in the Czech Republic and Hungary while the government of Ukraine is perennially on the verge of meltdown. Western European banks are exposed to these economies to the tune of $1,600 billion. That exposure could result in losses of $160 billion or, in the worst scenario, twice as much as that.

One area where progress was limited was shaping the G-20 into an organisation that better responds to the needs of those countries outside the rich elite who currently shape the main lines of the organisation's approach. Or to put it in more blunt language: to recognise that the American economy is no longer dominant and a host of competing rivals must now be taken into consideration. 

This is an area in which India should adopt its own role in shaping the new world economic order. It is a shame that Indian government and bureaucrats do not recognise that they are in a unique position, as a leading Asian economy just outside division one, to help shape the opinions of western governments in their approach. What may seem self-evident in New Delhi may not be so obvious elsewhere and the Indians, with their ability to communicate in English, could play a valuable role on behalf of middle-tier economies.

There might be problems with the conservatism of Indian bureaucrats who would still tend to ban rather than seek to regulate new product but there none the less could be a valuable role for them to play.

New Delhi should take the lead in reform of the IMF since there is now agreement that this organisation should be re-balanced by 2011. The key elements of the changes proposed hang on the appointment of the heads of international organisations on merit rather than by nationality.

While no one is coming to the defence of some of the more exotic products dreamed up in London and New York, such as credit default swaps, the G-20 meeting did not go so far as to try and ban innovative western financial instruments. The initiative remains with the regulator through such bodies as the proposed Financial Stability Board and the requirement that banks make better provision for the lean times when business is booming.

The other key issue which was sidestepped was the role of the dollar as the principal currency of international trade and the world's favourite reserve currency. The last few months have made it abundantly clear that the role of the dollar is in long-term decline and the only reason things are not moving faster is that there is no obvious candidate to replace the greenback.

Some experts dally with the euro as an alternative given the collective economic clout that backs the currency: a fine idea if only it was backed by solid political direction and what is now potentially threatened by the lack of stability in eastern Europe. The latter could result in a fairly dramatic fall-off in the euro's international exchange rate.

That good old stand-by, a basket of currencies, has been suggested but the left-field candidate might be one that is currently not being considered: the Chinese currency, the renminbi.

The transformation of a currency that has only relatively recently become exchangeable would be an unprecedentedly dramatic change in the fortunes of the Chinese. It would not necessarily find favour with the authorities in Beijing given the tensions and pressures which attend such status and many people might need reassurance of the long-term stability of the Chinese economy and government but stranger things have already happened in this economic year of living dangerously.

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