HOW DOES G-20 HELP INDIA?
Ashutosh K.
![Ashutosh K.]()
Ashutosh K.
Ex banker, Now self-employed, MD &CEO of Kumar Group of companies, Author of many books.
HOW DOES G-20 HELP INDIA?
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Background
1997-1999 ASIAN Financial Crisis:?This was a ministerial-level forum that emerged after G7 invited both developed and developing economies. The finance ministers and central bank governors began meeting 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. The G20 membership comprises a mix of the world’s largest advanced and emerging economies, Together, the G20 members represent more than 80% of the world GDP, 75% of international trade, and 60% of the world population.
Amid the 2008 Financial Crisis?
the world saw the need for a new consensus building at the highest political level. It was decided that the?G20 leaders?would begin meeting once annually. To help prepare these summits, the G20 finance ministers and central bank governors continue to meet on their own twice a year. They meet at the same time as the International Monetary Fund and The World Bank.
The work of G20 is divided into two tracks:
The finance track?comprises all meetings with G20 finance ministers and central bank governors and their deputies. Meeting several times throughout the year they focus on monetary and fiscal issues, financial regulations, etc. The Sherpa track focuses on broader issues such as political engagement, anti-corruption, development, energy, etc. Each G20 country is represented by its Sherpa; who plans, guides, implements, etc. on behalf of the leader of their respective country. (Indian Sherpa, at the G20 in Argentina, 2018 was Shri Shaktikanta Das)
?Members of G20
The members of the G20 are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, the Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom, the United States, and the European Union. Spain as a permanent, non-member invitee, also attends leader summits.
The Group does not have a permanent secretariat. The Presidency is supported by the Troika – previous, current, and incoming Presidencies. During India’s Presidency, the troika will comprise Indonesia, India, and Brazil, respectively.
The Structure and Functioning of G20
The G20 Presidency rotates annually according to a system that ensures a regional balance over time. For the selection of?the presidency, the 19 countries are divided into 5 groups, each having no more than 4 countries. The presidency rotates between each group. Every year the G20 selects a country from another group to be president.
India is in Group 2 which also has Russia, South Africa, and Turkey. The G20 does not have a permanent secretariat or Headquarters. Instead, the G20 president is responsible for bringing together the G20 agenda in consultation with other members and in response to developments in the global economy.
TROIKA: Every year when a new country takes on the presidency, it?works?hand in hand with the previous presidency and the next presidency, and this is collectively known as TROIKA. This ensures the continuity and consistency of the group’s agenda.
What about the Cooperation with and within G20?
In Toronto in 2010, leaders declared it to be the premier forum for global economic cooperation. The work of G20 members is supported by several international?organizations?that provide policy advice. These?organizations?include The Financial Stability Board (FSB). The FSB, which was established by G20 leaders following the onset of the global financial crisis, The International Labour Organization (ILO), The International Monetary Fund (IMF), The Organisation for Economic Co-operation and Development (OECD), United Nations (UN),, World Bank The World Trade Organization (WTO). The G20 also regularly engages with non-government sectors. Engagement groups from business (B20), civil society (C20),?labor?(L20), think tanks (T20), and youth (Y20) are holding major events during the year, the outcomes of which will contribute to the deliberations of G20 leaders.
According to the officials, 26 Delhi government departments and central agencies are engaged. Delhi will host the main summit meeting of the G20 (Group of 20) countries and seven other related events, starting in March. Earlier this month, Deputy Chief Minister Manish Sisodia had written a letter to the Centre, seeking a grant of Rs 927 crore to take up special development working on the preparations for the summit.
?What Types of Issues are Addressed by G20?
The G20 focuses on a broad agenda of issues of global importance, although, issues pertaining to the global economy dominate the agenda, additional items have become more important in recent years, like Financial markets, Tax and fiscal policy, Trade, Agriculture, Employment, Energy, Fight against corruption, Advancement of women in the job market, 2030 agenda for Sustainable development, Climate Change, Global Health, Anti-terrorism, and inclusive entrepreneurship.
What are India's Priorities in G20 Summits?
Checking tax evasion to fight corruption
Choking terror funds
Cutting the cost of remittances
Market access for key drugs
Reforms in the World Trade Organisation to improve its functioning
“Full implementation” of the Paris Agreement
What are the Strengths/Achievements of G20?
Flexible:?With only 20 members, the G20 is agile enough to make prompt decisions and to adapt to new challenges.
Inclusive:?The inclusion every year of invited countries, international organizations and civil society organization through engagement groups allow for a broader and more comprehensive perspective when assessing global challenges and building consensus to address them.
Coordinated action:?The G-20 has also played a crucial role in strengthening the international financial regulatory system, including better coordination across countries.
Facilitated an increase in lending?from multilateral development banks of US$235 billion at a time when private sector sources of finance were diminished.
Major achievements of the G20 include?quick deployment of emergency funding?during the 2008 global financial crisis.
It also works for?reforms in international financial institutions?by improving oversight of national financial institutions. Such as G20 driven reforms to the international tax system, through the G20/OECD Base Erosion and Profit Shifting (BEPS) project and implementation of tax transparency standards.
G20 played a critical role in the?ratification of the Trade Facilitation Agreement, with the WTO estimating it could contribute up to somewhere between 5.4 and 8.7%?to global GDP by 2030 if the agreement were fully implemented.
G20 India has put forth six agenda priorities for the G20 dialogue in 2023: -
Green Development, Climate Finance & Life
Accelerated, Inclusive & Resilient Growth
Accelerating progress on SDGs
Technological Transformation & Digital Public Infrastructure
Multilateral Institutions for the 21st century
Women-led development
?developed and developing countries together to bring consensus and reasoning into decision-making through discussion.
In 2021 (November) G20 summit, the leaders made a commitment to reach carbon neutrality by or around mid-century. They have adopted the Rome Declaration. Earlier, the?G20 Climate Risk Atlas?was released which provides climate scenarios, information, data and future changes in climate across the G20 countries.
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What are the Challenges Faced by G20?
No Enforcement mechanism:?The G20’s toolkit ranges from simple exchanges of information and best practices to agreeing on common, measurable targets, to coordinated action. None of this is achieved without consensus, nor is it enforceable, except for the incentive of peer review and public accountability.
Not legally binding:?the decisions are based on discussions and consensus which culminates in the form of declarations. These declarations are not legally binding. It’s just an advisory or consultative group of 20 members.
Polarization of Interests:
Russian and Ukrainian Presidents are invited to the G20 Summit to be held in November 2022. The U.S. has already demanded to not invite the Russian President, or U.S. and European countries would boycott his address. China’s strategic rise,?NATO’s?expansion, Russia’s territorial aggression in Georgia and?Crimea,?and now Russia Ukraine Conflict in 2022 changed global priorities.
Globalization?is no longer a cool word, and multilateral organizations have a credibility crisis as countries around the world pick being ‘G-zero’?(a term coined by political commentator Ian Bremmer to denote ‘Every Nation for Itself’)?over the?G-7, G-20, BRICS,?P-5 (UNSC Permanent Members)?and others.
?The G20 cannot be a panacea for the world’s problems. But over the past 10 years, the G20 has been an important forum for international cooperation. Effective global governance, like the G20, is essential as rising powers seek opportunities to influence and contribute to the global order. The G20 must strengthen the partnership with international organizations such as the IMF, the?OECD, the?WHO, the?World Bank,?and the?WTO, and delegate them the task of monitoring progress. Global Cooperation should be given priority over individual interest for the benefit of all the member countries. Use of Dialogue and Diplomacy should be carried out?to resolve issues like Ukraine - Russia conflict and differences between Russia and the west. India should focus on utilizing the G20 2023 summit?as a platform to raise discussions on issues such as aggressive trade barriers/ sanctions, and inter-country conflicts and advocate for global peace and cooperation.
???????Maintain world order which prevailed immediately after World War II as well as the new power balance created by its victors. The G 20 is a reflection of an emerging order, which brings the G7 together with other major economies as equal partners. It also includes the P5 with other major emerging economies. Conceived as an international mechanism for governance of the global economy, the G20, which includes all the major economies, has evolved over time into one of the most powerful economic and financial groupings. At present, it comprises 85% of the global GDP, 75% of international trade, and two-thirds of the global population. It represents the world’s key body for handling global economic and developmental issues.
Held under a rotational Presidency on an annual basis since 2011, the G20’s initial focus was on broad macro-economic policy. Formally known as the “Summit on Financial Markets and the World Economy”, the G20 has made continuous efforts until the pandemic toward achieving robust global economic growth. It re-doubled its efforts after the pandemic. More recently, the G20 focus shifted to include a wide range of global issues including climate change and energy, health, counter-terrorism and migration.
What is the composition of the G20? It comprises 19 countries (Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, the Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the UK, and the USA) and the European Union (EU). It has become a relevant and influential global grouping. The regular participation of international and regional organizations such as the African Union, NEPAD, and ASEAN as invitees in the G20 process makes it both inclusive and representative.
The G20’s initial focus was on financial and socio-economic issues. Since it was raised to the level of Heads of State and Government, the G20 has evolved to address every contemporary issue and challenge. There are 20 Working Groups between the Sherpa and Finance Tracks and 10 Engagement Groups, which bring together the civil societies, think tanks, and other key stakeholders of the member countries.
Existing G20 Tracks
The G20 currently comprises several tracks including:
-‘Finance Track’, with 8 work streams (Global Macroeconomic Policies, Infrastructure Financing, International Financial Architecture, Sustainable Finance, Financial Inclusion, Health Finance, International Taxation, and Financial Sector Reforms).
-‘Sherpa Track’, with 12 work streams (Anti-corruption, Agriculture, Culture, Development, Digital Economy, Employment, Environment, Climate, Education, Energy Transition, Health, Trade, and Investment, Tourism). Shri Amitabh Kant is the Indian Prime Minister’s Sherpa for this period.
-‘10 Engagement Groups’?of private sector/civil society/independent bodies (Business 20, Civil 20, Labour 20, Parliament 20, Science 20, Supreme Audit Institutions 20, Think 20, Urban 20, Women 20, and Youth 20).
India’s Presidency
India has been a member of the G20 since its inception in 1999. As an important member of the grouping, India ensured that its perspective on issues of vital national importance did not go unheard in the global financial narrative. India will be assuming the chairmanship of the G20 for one year from 01 December 22.
India’s Presidency comes at a watershed moment coinciding with a period of flux, internationally. The global community is facing multiple challenges, politically and economically. The Russia-Ukraine conflict has vitiated relations between Russia and the industrialized Western countries, most of which are members of the G20. The conflict and the resulting unilateral sanctions imposed by the West have upset the post-pandemic global recovery, and sharply impacted oil and gas prices as well as food availability. As always, the impact is felt most sharply by the most vulnerable, the developing countries and LDCs.
India would, in the true spirit of?Vasudhaiva Kutumbakam?(the world is one family), seek to find pragmatic global solutions for the well-being of all. India’s vision for the global development agenda is shaped by the rapid transformation of its economy and society launched by the Prime Minister, particularly green and digital transformations. The after-effects of the pandemic are also of importance, as it underlined the importance of resilient healthcare and global cooperation.
PM Modi has transformed India’s foreign policy to focus on the ‘global common good’. Through its G20 leadership, India hopes to extend this principle towards finding sustainable solutions to some of the key global challenges emerging out of the interconnectedness of the world, such as climate change, new and emerging technologies, food and energy security, etc. As the incumbent G20 President, India will set the agenda, identify the themes and focus areas, conduct discussions, and deliver the outcome documents. India will identify, highlight, develop, and strengthen international support for priorities of vital importance in diverse social and economic sectors, ranging from energy, agriculture, trade, digital economy, health, and environment to employment, tourism, anti-corruption, and women’s empowerment, including in focus areas that impact the most vulnerable and disadvantaged. For India, the G20 Presidency also marks the beginning of “Amritkaal”, the 25-year period beginning from the 75th anniversary of its independence on 15 August 2022, leading up to the centenary of its independence, towards a futuristic, prosperous, inclusive, and developed society, distinguished by a human-centric approach at its core. Sherpring together systemically important industrialized and developing economies to discuss key issues in the global economy. ?This is like international financial Stability, environmental changes, greenhouse gas emissions, and sustainable development. So, these are some aims and the issues that will be solved by the G20 summit. This year also to resolve issues the G20 will be going to hold. The official website link of the G20 2023 Summit is www.g20.org.
G20 talks: India to push for making trade inclusive, and growth-oriented for developing countries. The public works department (PWD), Municipal Corporation of Delhi (MCD), and the NDMC will mainly be associated with civic infrastructure improvement and beautification work. It is estimated that the PWD, the MCD, and the NDMC will spend ?448 crores, ?249 crores, and ?78 crores respectively on it, a senior government official said. Repairing roads and pavements, beautification of medians, pavements, and traffic islands on major road stretches, illumination work, horticulture, installation of LED lights, and electric buses for the visitors and foreign delegates have been planned for the summit. The tourism department of the city government has planned various events and programs and estimated a budget of ?72 crores for the same, the officials said. India is currently part of the G20 Troika (current, previous, and incoming G20 Presidencies) comprising Indonesia, Italy, and India. From December 22, during India’s Presidency, Indonesia and Brazil along with India would form the Troika. This would be the first time when the Troika would consist of three developing countries and emerging economies. It is hoped that as a result there would be a shift in the balance of power within the G20. It is time for emerging economies to have a greater share in decision-making at this grouping. India will host the G20 Leaders’ Summit at the level of Heads of State / Government on 9th?and 10th?September 2023, in New Delhi. Under its Presidency, India is expected to host over 200 G20 meetings across India, commencing in December 2022. India is preparing to hold up to 190G20 meetings on a pan-India basis. In our effort to organize an Impeccable and Uniquely ‘Indian’ G20, we strive to make this mega event closer to the lives of the people of India making it ‘People’s G20’.
A G20 Secretariat has been established with Cabinet approval. Former Foreign Secretary Harsh V. Shringla has been appointed as India’s chief G20 Coordinator at Secretary Level. His tenure commenced on 1st?May 22 till 31st?December 23. The G20 Secretariat will be responsible for the implementation of overall policy decisions and arrangements needed for steering India’s Presidency. The Secretariat will be responsible for a smooth transition from the previous Presidency, preparations and conduct of all G20 meetings during the year, consultation and coordination with stakeholders, and finally handing over to the next Presidency in December 2023. The Secretariat will also enable capacity building, including knowledge and expertise, for supporting India’s leadership on and contribution to global issues in multilateral forums in the years ahead. The Secretariat will handle work relating to knowledge, technical, media, security, and logistical aspects of the Presidency. The Cabinet Secretariat said in a statement: “It will be manned by officers and staff from the Ministry of External Affairs, Ministry of Finance, and other relevant line Ministries/Departments and domain knowledge experts. The Secretariat will be functional till February 2024”.
The India Trade Promotion Organisation (ITPO) has almost completed the re-development of Pragati Maidan for setting up a world-class Integrated Exhibition-cum-Convention Centre (IECC) at a cost of Rs 2254 crore. It is the venue of the Summit.[ii]?The Government has commenced the process of recruitment to the Secretariat. In a tweet citing a tweet by Ministry of External Affairs Spokesperson Arindam Bagchi confirming that recruitment had started, Prime Minister tweeted: “This is an exciting opportunity.?In accordance with past tradition, the Presidency usually invites some ‘Guest’ countries and International Organizations (IOs) to its G20 meetings and summits. MEA has announced that as President, India will invite Bangladesh, Egypt, Mauritius, Netherlands, Nigeria, Oman, Singapore, Spain, and UAE as ‘Guests’. Bangladesh is the only South Asian neighbor invited as a ‘Guest’ to the Summit.
Further, in addition to regular International Organizations (UN, IMF, World Bank, WHO, WTO, ILO, FSB, and OECD) and Chairs of Regional Organizations (AU, AUDA-NEPAD, and ASEAN), India, as G20 Presidency, will be inviting as ‘Guest IO’s’ the ISA (International Solar Alliance), the CDRI (Coalition for Disaster Resilient Infrastructure) and the ADB (Asian Development Bank). ?
Priorities of the Presidency
What would be the priorities of the Indian Presidency? According to MEA: “Ongoing conversations…revolve around inclusive, equitable and sustainable growth; LiFE (Lifestyle For Environment); women’s empowerment; digital public infrastructure and tech-enabled development in areas ranging from health, agriculture, and education to commerce, skill-mapping, culture, and tourism; climate financing; circular economy; global food security; energy security; green hydrogen; disaster risk reduction and resilience; developmental cooperation; fight against economic crime; and multilateral reforms.”
Among its key priorities are climate, digital, and health. The Presidency provides an opportunity to showcase India’s leadership inter-alia in climate action and climate commitments. Prime Minister Modi has pointed out that India’s dedication to climate commitments is clear. India has achieved the target of 40% energy capacity from non-fossil sources, nine years before the deadline. At the COP26 Summit last year, Mr. Modi announced the ‘Panchamrit’ or five major areas of climate action commitments by India, including creating a net zero economy by 2070.?Access to climate finance and technology would be critical in facilitating these ambitious goals, particularly for developing countries.
Prime Minister emphasized the importance of behavioral change for catalyzing climate action and highlighted the need for collective action by the global community as part of a movement called LIFE – Lifestyle for Environment.?These are most relevant for the G20 today. On digital, India hopes that our start-up sector and our proven capabilities to create tech models that balance the need for global integration and priorities at a national level can be internationalized. Digital India would go global. A new tech order must combine cross-border flows of technology and investment with development and growth aspirations.