Description
INDIA AS THE G20 PRESIDENT: OPPORTUNITES AND CHALLENGES
News in Focus
• India has got the G20 Presidency from Indonesia from 1 December 2022 to 30 November 2023. It will convene the G20 Leaders' Summit for the first time in the country in 2023.
• Hence, in this article, we are discussing about the G-20 (members, functions, significance, etc), opportunities and challenges for India.
What is G-20?
• The G20 was founded in 1999 after the Asian financial crisis as a forum for the Finance Ministers and Central Bank Governors to discuss global economic and financial issues.
• It is the premier intergovernmental forum for international economic cooperation and plays an important role in shaping and strengthening global architecture and governance on all major international economic issues.
Who are the members?
• Members: Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Türkiye, United Kingdom and United States) and the European Union.
• The G20 members represent
90% of global GDP.
80% of international global-trade
2/3 of the world’s population lives in G20 member countries.
84% of all fossil fuel emissions are produced by G20 countries
What is the purpose of G20?
• The purpose of the G20 are:
a) Policy coordination between its members in order to achieve global economic stability, sustainable growth;
b) To promote financial regulations that reduce risks and prevent future financial crises; and
c) To create a new international financial architecture.
How does the G20 work?
• The G20 Presidency steers the G20 agenda for one year and hosts the Summit.
• The G20 consists of two parallel tracks: the Finance Track and the Sherpa Track.
Finance Ministers and Central Bank Governors lead the Finance Track
Sherpas, who are personal emissaries of the Leaders, lead the Sherpa Track.
• In addition, there are Engagement Groups which bring together civil societies, parliamentarians, think tanks, women, youth, labour, businesses and researchers of the G20 countries.
• The Group does not have a permanent secretariat. The Presidency is supported by the Troika - previous, current and incoming Presidency. During India’s Presidency, the troika will comprise Indonesia, India and Brazil, respectively.
What is the significance of G-20?
• The G20 plays a critical role in creating an enabling environment for inclusive global growth and development.
• Its work for ensuring financial stability, promoting growth and avoiding and managing crises mainly faced by LIDCs.
The G20’s major achievements include:
strengthening the role of emerging economies, such as BRICS.
reforming international financial institutions.
improving discipline and tightening oversight over national financial institutions and regulators.
improving the quality of financial regulations in economies whose regulatory problems led to the crisis.
creating financial and organizational safety nets to prevent severe economic slumps in the future.
Criticisms faced by G-20
• Heterogeneous members struggle to achieve consensus; thus no concrete outcome comes.
• For the last several years, financial vulnerabilities and deepening geopolitical tensions have greatly contributed to global economic instability leading to movement for narrower regional interests
• The G20’s shortcomings were exposed in the early days of COVID-19. Rather than acting in unison, its members adopted uncoordinated national policies
• The G20’s lacks an objective framework through which to set goals and measure progress toward them. Its agenda has been fluid, with each host country adding something new to the mix at every annual gathering.
• The G20 is not a treaty-based multilateral organization capable of taking legally binding decisions, much less implementing them.
Now, moving towards the analysis of the current news.
Opportunities
• Bigger role in Economic Issues: India has the chance to play an important role in shaping and strengthening global architecture and governance on all major international economic issues.
• Role in Russia-Ukraine crisis: The war in Ukraine and its implications including food and energy security — figured particularly highly in the talks in Bali, but there was no outcome. India could take the opportunity to leverage its historical and amenable ties with Russia, and bring a more isolated Moscow to the discussion and diplomacy roundtable of over 200 G20 meetings to follow.
• Voice for Global South: India is also at the center of a troika of G20 presidencies — of Indonesia, India and Brazil, respectively — all of them emerging economies, thus, providing a greater voice for making the concerns of the “Global South” on issues such as climate change, trade facilitation and health care resilience support.
• Focus on sustainable development: G20 presidency will function around the principles of the universal sense of one-ness – ‘One Earth, One Family, One Future’ – based on the adage Vasudhaiva Kutumbakam, meaning ‘that all of the world, universe or reality is one’.
One Earth: heal the planet by encouraging sustainable and environment-friendly lifestyles based on Indian traditions.
One Family: promote harmony within the human family by depoliticizing pertinent supply chains of food, fertilizers, and medicines. This is done with the aim to prevent humanitarian crises due to geo-political tension.
One Future: encourage honest conversations among the most powerful nations of the world regarding core issues of climate change and mitigation of risks posed by weapons of mass destruction to enhance global security.
• Focus on common good: The agenda for G20 will be climate change, terrorism, endemics, and pandemics. Further key focus will be on the use of technology to formulate digital solutions which can be implemented at a global level.
India’s Presidency is all about human-centric globalisation and is expected to have large-scale impact on the intergovernmental policy formulations and discussions that will influence the New World order and set the global post-pandemic economic agenda.
India's G20 Priorities
• Green Development, Climate Finance & Lifestyle for Environment (LiFE)
• Accelerated, Inclusive & Resilient Growth
• Accelerating progress on Sustainable Development Goals (SDGs)
• Technological Transformation & Digital Public Infrastructure
• Multilateral Institutions for the 21st century
• Women-led development
India kick-started its presidency term agenda with a series of cultural initiatives that included various Jan Bhagidari activities, a special University Connect event with 75 educational institutions from across the country, the lighting up of 100 ASI monuments with the G20 logo and colours, and showcasing G20 at the Hornbill festival in Nagaland.
Challenges
The G20 summit will be a big success if all nations keep their geo-political differences aside and strive to work for the common good. However, the few challenges faced by Indian Presidency are:
• Bringing different groups together
In the last few months, G20’s credibility has taken a hit due to internal. India has to iron out the differences and lead from the front. It has to find innovative solutions and build bridges.
• Strengthening Multilateral Development Banks (MDBs)
Indian Presidency has to reconsider transboundary challenges to financing needs through MBDs, which constitute a significant hurdle in addressing shared global economic challenges like global inflation, food and energy insecurity and macro-economic implications of climate change. India has to take a big step forward in bringing governance reforms at the IMF and the World Bank.
• Climate change
Both developing and developed nations have to come on one platform.
A 'Joint Research Platform' should be established with top scientists on its board to research on food productivity, global health care and ways to mitigate the adverse impacts of climate change. This research platform could have various centers of excellence. Joint research must be also conducted in the fields of space technology, renewable energy and on ways to arrest the effects of natural disaster.
• Energy security
The country must give primacy to energy security while focusing on better governance, strategy and calibrated measures to deal with climate risks.
• Global food crisis
India has to take measures to ensure global food security and a clear-cut G20 policy on the Russia-Ukraine war.
Thus to conclude, the way forward for India’s Presidency
The critical areas that need to be dealt with along with carving out an acceptable solution to the challenges would include:
Multilateral cooperation: India must not only take the lead in strengthening the G20 group and reducing the differences that have crept in due to the geopolitical situation, but also set the pace for the future of multilateral cooperation in various fields of the group’s multidimensional agenda.
Inclusive approach: India must bring forth the views of countries that are not represented in the G20. India must encourage a comprehensive approach with human-centric arrangements
Elevating the African Union: Another significant objective should be to end the sidelining of African nations by promoting the African Union’s (AU) status from being a perpetual observer to member status of the G20, bringing it to the level of the EU.
India-focused view: India must strive to bring together an Indo-centric vision, expand the area of critical concerns of the Global South.
Strengthening Systems: As the President of the G20, India must aim to strengthen its partnership with international organisations such as the IMF, OECD, WHO, World Bank, and WTO.
International Institute for Regulatory Development: The G20 presidency gives India an opportunity to initiate a transformation of the global regulatory structure by establishing the International Institute for Regulatory Development (IIRD). India can be the torchbearer for a new regulatory framework.
Conclusion
India, at the G20 summit, has very clearly articulated its vision by stating that, “Without peace and security, our future generations will not be able to benefit from economic growth and technological innovation.” As an established global leader now, the promise PM Modi makes for an action-oriented and ambitious presidency will be closely watched, not only by the members of the G20 but also by international institutions like the UN, think tanks, diplomats across the world, and more importantly, by the neighbouring countries of the Indian Ocean Region (IOR).
