Context

• India’s presidency of the G20 grouping next year arguably the sole remaining effective forum for global governance presents an enormous opportunity to accelerate sustainable growth within India, in the emerging world, and beyond.

About G20

• Formed in 1999, the G20 is an international forum of the governments and central bank governors from 20 major economies.

Features

• Collectively, the G20 economies account for around 85 percent of the Gross World Product (GWP), 80 percent of world trade.
• To tackle the problems or the address issues that plague the world, the heads of governments of the G20 nations periodically participate in summits.
• In addition to it, the group also hosts separate meetings of the finance ministers and foreign ministers.

Objectives

• Stability: The Group was formed with an aim of studying, reviewing, and promoting high-level discussion of policy issues pertaining to the promotion of international financial stability.
• Fiscal responsibilities: The forum aims to pre-empt balance of payments problems and turmoil on financial markets by improved coordination of monetary, fiscal, and financial policies.
• Universal Support: The forum seeks to address issues that go beyond the responsibilities of any one organisation.

Is India ready for G20 leadership?

• At some levels, India is ready.
• Indian business and industry is becoming a noteworthy competitor globally.
• The country’s domestic economy is starting to pick up, thanks to structural economic reforms.
• The central government is economically stronger, and the states are starting to learn about economic independence, making them more aligned with their global counterparts.

Punchline

It is said that “those who hold the pen, write the rules”.

The time has come for India to both hold the pen and write the rules for a more equitable global economics and governance.

Issues and Challenges

• India need to have a clear global financial agenda.
• The country should also have the capacity to lead the G20 year intellectually, financially, managerially and administratively.
• Geopolitically, India is more internationally engaged but less so geoeconomically.
• Its narrow focus is on the World Bank, IMF, WTO and foreign investment issues.
• But India has much to contribute on issues like reconfiguration of global financial regulations, design of a new framework for trade in services and the digital economy and establishing better cross-border standards for transparency in financial flows.
• To make its G20 year a success, India has to address organisational challenges, where the country has an infrastructure, management and intellectual gap.

What could India bring to the table?

• Mediation: Firstly, it remains pertinent for the world that escalating tensions between Russia and Ukraine come to a halt. Maintaining its balanced stance, India needs to neutralise this situation by introducing peace talks between the two nations.
• Open trade: It’s about time for India to raise its voice in support of a transparent New Economic Order and building a prosperous and just world. Unreasonable bans on certain commodities from various countries limits commerce between states when trade liberty exists.
• Collaboration around science and technology: The global agenda has been tilted towards investment, whereas science and technology are the driving force for economic diversification, sustainably urbanising the world, and ushering the hydrogen economy and new crop varieties as the answer to both human well-being and global climate change.
• Redefining digital access as universal service: Harnessing the potential of the digital-information-technology revolution requires redefining digital access as a “universal service” that goes beyond physical connectivity to sharing specific opportunities available.

Conclusion

• India’s presidency must leave the grouping with the agility and energy to respond to new realities, and it must create a future-ready multilateralism through a novel and robust institutional architecture.

Mains question

Q. It is said that “those who hold the pen, write the rules”. The time has come for India to both hold the pen and write the rules for a more equitable global economics and governance. Discuss in the context of India’s presidency of G20 summit with challenges and opportunities ahead.

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