“G20 Presidency is not merely a diplomatic meeting for India, it is a new responsibility and a measure of the world’s trust in India”, said PM Modi. As India gets ready for G20 presidency, it is highly important to know the key issues of G20 meet at Indonesia and how important is the presidency for India. Let’s learn from basics to advance about G20 for your exams and general knowledge.
Relevance: Important International institutions, agencies and fora- their structure, and mandate are highly important for exams- GS II (International Relations). G20 is especially relevant as India gets the presidency. Know the basics and why it is an opportunity for India to represent the global south and developing countries.
— The G20 Leaders Summit in Bali, Indonesia ended yesterday. The presidency passes on to India for the next G20. India will host the G-20 leaders’ summit in 2023 in New Delhi. President of Indonesia Joko Widodo handed over the G20 Presidency to Prime Minister Narendra Modi at G20 summit, in Bali, Indonesia on Nov. 16, 2022.
What is the G20?
— The G20 was formed in 1999 in the backdrop of the financial crisis of the late 1990s that hit East Asia and Southeast Asia in particular. Its aim was to secure global financial stability by involving middle-income countries.
— On the advice of the G7 Finance Ministers, the G20 Finance Ministers and Central Bank Governors began holding meetings to discuss the response to the global financial crisis that occurred. After that, the Minister of Finance level meeting is held regularly in the fall.
— Nine years later, on November 14-15 2008, the leaders of the G20 countries gathered for the first G20 Summit.
Together, the G20 countries include 60 per cent of the world’s population, 80 per cent of global GDP, and 75 per cent of global trade.
— The members of the G20 are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom, the United States, and the European Union. Spain is invited as a permanent guest.
— The presidency of the G20 rotates every year among members, and the country holding the presidency, together with the previous and next presidency-holder, forms the ‘Troika’ to ensure continuity of the G20 agenda. Italy, Indonesia, and India are the Troika countries right now.
How does the G20 work?
— The G20 has no permanent secretariat. The agenda and work are coordinated by representatives of the G20 countries, known as ‘Sherpas’, who work together with the finance ministers and governors of the central banks. India recently said ex-NITI Aayog CEO Amitabh Kant would be the G20 Sherpa after Piyush Goyal.
“On the advice of the G7 Finance Ministers, the G20 Finance Ministers and Central Bank Governors began holding meetings to discuss the response to the global financial crisis that occurred,” the G20 website says. Since 1999, an annual meeting of finance ministers has taken place.
— The first G20 Summit took place in 2008 in Washington DC, US. In addition to Summits, the Sherpa meetings (that help in negotiations and building consensus), and other events are also organised throughout the year. Each year, the presidency invites guest countries.
The G20 currently comprises:
# Finance Track, with 8 work streams (Global Macroeconomic Policies, Infrastructure Financing, International Financial Architecture, Sustainable Finance, Financial Inclusion, Health Finance, International Taxation, Financial Sector Reforms).
# Sherpa Track, with 12 work streams (Anti-corruption, Agriculture, Culture, Development, Digital Economy, Employment, Environment and Climate, Education, Energy Transition, Health, Trade and Investment, Tourism)
# 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).
Theme: Recover Together Recover Stronger
According to g20.org, “As the global pandemic continues to affect all sectors of life, the future of our shared prosperity relies on our collective ability to create an inclusive and sustainable foundation for growth.”
Priority issues:
1. Global Health Architecture- This involves deliberations towards strengthening global health resilience and making the global health system more inclusive, equitable, and responsive to crises.
2. Sustainable Energy Transition- Deliberations here have centred on achieving the full potential of rapid digitalisation of the global economy by creating a new landscape of cooperation among nations.
3. Digital Transformation- Under this rubric, the discussions have focussed on ways to accelerate the transition towards cleaner energy sources. In particular, since any such transition requires substantial investments, the efforts have been focussed on finding a platform for such investments.
Why was G20 summit at Indonesia was crucial?
Udit Misra in G20 Summit: What’s at stake? highlights why G20 summit at Indonesia is relevant.
— Since the October 2021 summit in Rome, prospects of the global economy have worsened. Between themselves, the G20 countries account for 60 per cent of the world’s population, 80 per cent of the world’s GDP and 75 per cent of the world’s exports. As such, they contain the engines of global growth.
— However, from a recent report of the International Monetary Fund on G20 countries shows, most of the G20 constituent countries have suffered significant output losses since the start of the Covid-19 pandemic. India, for instance, would have lost almost 14 per cent of its total output — the highest loss among all G20 countries.
Why have prospects worsened?
— There are many reasons why global growth and the promise of globalisation have received a severe setback.
For one, Russia’s invasion of Ukraine has not only created massive geopolitical uncertainty but also spiked global inflation, thanks to supply bottlenecks and curbs across a whole host of commodities. The associated sanctions by the West have further queered the pitch. Persistently high inflation — at historic highs in several countries — has eroded purchasing power across these countries, thus dragging down economic growth.
— Two, in response to high inflation, central banks across countries have raised interest rates, which, in turn, have dampened economic activity further. Some of the biggest major economies such as the US and the UK are set to face a recession; others, such as those in the euro area, are likely to slow down to almost a halt.
— Three, China, one of the major engines for global growth, is witnessing a sharp slowdown as it struggles with a real estate crisis.
— Lastly, the world economy is struggling with geopolitical rifts such as the tensions between the US and China, the two biggest economies in the world, or the decline in trade between the UK and the euro area in the wake of the Brexit decision.
Where do the solutions lie?
— For global prospects to improve, two things are certain. One, the G20 countries can grow faster if they grow together. Two, such growth, in turn, requires peace. Given the scope of G20 countries, the summit thus affords an opportunity for the leaders to find common ground and iron out the creases in the policy landscape.
— According to the IMF, “the overarching priority for policymakers in most economies is to ensure price stability while bringing down debt levels and protecting the most vulnerable”. In other words, the first job at hand is to contain raging inflation. But at the same time, governments have to find ways to help the vulnerable without necessarily ballooning the debt levels. A key concern in this regard would be to ensure that external risks are carefully monitored.
— Secondly, as the IMF said, “a strong, sustainable, balanced, and inclusive recovery requires joint action by the G-20”. This kind of joint action, in turn, requires not just securing peace in Ukraine but also “help prevent further fragmentation”.
— On trade, the G20 leaders need to push for a “more open, stable, and transparent rules-based trade” that would help address global shortages of goods. “Strengthening the resilience of global value chains would help protect against future shocks,” said the IMF.
What are the major takeaways from the G20 summit at Indonesia?
Shubhajit Roy highlights in The Indian Express that as India take G20 presidency, there are 5 takeaways from the summit in Bali.
1. G20 communique echoed Prime Minister Narendra Modi’s message to Russian President Vladimir Putin, underlining that “Today’s era must not be of war.” Prime Minister Modi, in his statement to President Putin in a bilateral meeting on the margins of the Shanghai Cooperation Organisation (SCO) summit in Samarkand in September this year, had said, “Now is not the time for war.”
This, according to Indian officials, was an outcome of a constructive, cooperative, and consensus-building approach adopted by India, which helped bridge the gap between Russia and the Western countries led by the US.
2. US President Joe Biden met with Chinese President Xi Jinping on the sidelines of G20, their first face-to-face conversation as leaders of their two countries. The presidents of the world’s two most powerful economies talked for about three hours at a time when the ties between their countries have been strained, and their post-meeting comments are seen as an incremental step towards rebuilding the fractured relationship. Taiwan dominated the discussions, and in their readouts of the meetings, both leaders urged “peace and stability” in the Taiwan strait.
3. The divide between Russia and the West led by the US was evident again for a few hours after news of the “Russian-built” missile landing in Poland broke. G7 leaders gathered quickly to condemn the alleged Russian action — which was seen as a message from President Putin to the West. Putin did not attend the summit in Bali, and the barrage of Russian missiles targeting Kyiv at the same time as the G20 leaders were meeting, was seen as a show of strength by the Kremlin after Russian forces were forced to withdraw from Kherson — a retreat that Ukraine’s President Volodymyr Zelenskyy declared was “the beginning of the end of the war”. It later turned out that the missile that landed in Poland had been fired by the Ukrainians to intercept an incoming Russian missile attack.
4. Modi and Xi met at dinner hosted by Indonesian President Joko Widodo. This was possibly one of the most stark images out of the summit, as the two leaders — who had met at least 18 times between 2014 and 2019 — met after a two-year hiatus. In their first meeting in public view since the India-China border standoff began in 2020, Prime Minister Modi and President Xi shook hands and spoke to each other.
While there was no substantive readout on the conversation that was captured by the cameras at the summit dinner, sources said the two leaders “exchanged courtesies at the conclusion of the dinner”. The last time Modi and Xi had been seen interacting in public was in Brazil in November 2019, on the sidelines of the BRICS summit. In October 2019, Xi visited India for an informal summit in Mahabalipuram. In September this year, the two leaders attended the SCO summit in Samarkand, Uzbekistan, but there were no photographs or statements about a meeting between them.
5. India has got the presidency of the G20, the first time the country will be holding an international summit of this scale.Indonesia’s President handed over the gavel to the Indian Prime Minister as the next chair of the grouping. New Delhi will host G20 leaders for the summit on September 9 and 10, 2023.
At the closing session of the summit, Prime Minister Modi told G20 leaders that India’s presidency will be “inclusive, ambitious, decisive, and action-oriented”.
He underlined environment, women-led development, peace and security, economic growth, technological innovation as priorities, which are embodied in the theme of India’s G20 chairmanship: “One Earth, One Family, One Future”.
Earlier, Modi had said on November 15 that the Covid pandemic, climate change and Ukraine conflict have together caused “havoc in the world”, leaving supply chains “in ruins” and triggering a “crisis of essentials”, adding that the poor face a “more severe” challenge. He had called for a “new world order for post-Covid period”.
(source: As India take G20 presidency, 5 takeaways from the summit in Bali by Shubhajit Roy )
What else shouldn’t be missed about G20 at Indonesia?
—Despite the fraught session, the summit had consequential bilateral interactions, including the first meeting between Prime Minister Modi and the new British Prime Minister Rishi Sunak. Sunak’s green light to the reciprocal “young professionals scheme” under which the UK will give 3,000 visas to Indian graduates in the age group of 18-30 to live and work in the country for two years is likely to smoothen the path towards a quick finalisation of the Free Trade Agreement which hit a road bump last month.
—The meeting between US President Joe Biden and Chinese President Xi Jinping may not have helped them to find common ground, but the important takeaway from this, which India, as a Quad ally must note, is that the two sides are engaged.
—Indonesia Just Energy Transition Partnership (JETP) is a long-term political agreement between the Indonesian Government and the International Partners Group (IPG). The US and Japan have joined as leads.
—The other countries are the United Kingdom, Germany, France, the European Union, Canada, Italy, Norway, and Denmark.
—Indonesia is among the world’s top 10 greenhouse gas emitters. The JETP will help the country to achieve an accelerated shift from fossil fuel dependence to renewable energy sources. It aims to achieve this energy transition keeping in mind that it will not adversely affect the workers and communities at large.
—India will assume the G20 presidency from the current chair Indonesia on December 1.
Prime Minister Narendra Modi on Tuesday unveiled the logo, theme and website of India’s G20 presidency. The logo bears a lotus and the message of ‘Vasudhaiva Kutumbakam — One Earth, One Family, One Future.
What is the significance of the G20 logo?
—The PM said the logo is not just a symbol, but a message and a resolve. “This G20 logo is not just a symbol, it is a message, an emotion running through our veins. It is a resolve, which is now being included in our thoughts,” the Prime Minister said.
—Elaborating, the Prime Minister said that the logo reflects our idea of Vasudhaiva Kutumbakam (the whole earth is a family), because of which India has always believed in global harmony. “The lotus flower symbolises our Puranic heritage, our aastha (belief) and boddhikta (intellectualism),” he said.
“India, with its mantra of ‘One Sun, One World, One Grid’, has called for a renewable energy revolution in the world. India took up a campaign of ‘One World, One Health’ to strengthen global health. Now, in the G20 also, our mantra is One Earth, One Family, One Future. These thoughts and values of India show the way for the welfare of the world,” PM said.
What is G20 trioka?
—In a historic first for developing countries, the G20 troika after December 1 will comprise the past, the incoming and the next G20 presidencies, i.e., Indonesia, India and Brazil. It refers to the top grouping within the G20 that consists of the current, previous and the incoming presidencies.
How G20 presidency is an opportunity for India to make a mark as a global leader?
G20 presidency as an opportunity for India to represent global south and developing countries
Nirupama Subramanian in The Indian Express highlights the importance of G20 for India.
—In recent months, India has repeatedly spoken about the global South, positioning itself as the voice of the developing world. Presenting India’s statement at the United Nations General Assembly in September, External Affairs Minister S Jaishankar foreshadowed Prime Minister Narendra Modi’s remarks at Bali, when he said the global South was the most impacted by the “sharp deterioration in the international landscape”.
—In a world struggling to cope with post pandemic economic challenges, the conflict in Ukraine had added rising costs, the scarcity of fuel, food and fertilisers, plus trade disruptions and diversions, he said, making a case for a negotiated diplomatic end to the war.
“As we begin the G20 presidency this December, we are sensitive to the challenges faced by developing countries. India will work with other G20 members to address serious issues of debt, of economic growth, food and energy security and particularly, of environment. The reform of the governance of multilateral financial institutions will continue to be one of our core priorities,” he said, underlining India’s “steadfast commitment to South-South Cooperation”.
During a visit to Russia last month, S Jaishankar told his counterpart Sergey Lavrov that the global South was “in acute pain” due to the war, as he advocated dialogue and diplomacy.
—The G20, many in India’s strategic community are suggesting, is India’s opportunity to take on the role of peace-maker on behalf of the South. Modi’s remarks at the Bali summit suggest that India might use its presidency in that direction.
“The onus of creating a new world order for the post-Covid period lies on our shoulders. I am confident that next year when the G20 meets in the holy land of Buddha and Gandhi, we will all agree to convey a strong message of peace to the world,” Modi said.
—India is also readying to push for global consensus on maintaining stable supply chains for food and fertilisers to build food security globally, and for stable supplies of energy. Another item on the agenda, going by Modi’s remarks, might be to push the global North on its promise of climate finance and tech transfer to developing countries.
—Modi’s reference to India’s development of Unified Payment Interface as having brought about a “digital revolution”, and the digital divide in the developing world indicated another likely big idea during India’s presidency: a lead role for India in transferring this technology to other countries.
“India is keen to take its digitised public goods architecture to developing countries, and the mission is to find funding for it. When we talk about India as a leader of the Global South, this may be one way to illustrate its implementation,” Amb. Bhatia said.
—PM Modi rightly stressed that peace and development were essential for people to reap the fruit of economic development. Modi has promised that India’s leadership of the G20 will be “inclusive, ambitious, decisive, and action-oriented”, hinting that Delhi is planning to push a global campaign for a sustainable lifestyle, LiFE (Lifestyle for Environment). The theme of India’s G-20 chairmanship, as announced earlier this month, is “One Earth, One Family, One Future”.
For India, this is an opportunity to make a concerted push for the global south. A debt crisis haunts many middle income economies. Climate change, and finding the money to make the “clean” transition, is another challenge. This is an opportunity for India to make a mark as a global leader.
(source: Road to G20, Delhi 2023 by Nirupama Subramanian)
Point to ponder: G-20 presidency is an opportunity to position India as the voice of the Global South. Discuss.
MCQ:
In which one of the following groups are all the four countries members of G20? (2020)
(a) Argentina, Mexico, South Africa and Turkey
(b) Australia, Canada, Malaysia and New Zealand
(c) Brazil, Iran, Saudi Arabia and Vietnam
(d) Indonesia, Japan, Singapore and South Korea
Can you recall what you read?
1. Why was the relevance of G20 meet at Indonesia?
2. What is G20 trioka?
3. What is JETP?
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