G20 Presidency

In News: India is assuming its G20 presidency for a year which is a significant development for India.

Context:

• G20 comprises 20 of the world’s largest economies, which represent around 85 per cent of the global GDP, over 75 per cent of international trade, and about two-thirds of the world population.
• India will join a small group of developing nations, which includes Mexico, China, Argentina, Saudi Arabia and Indonesia, that have assumed presidency of the group since the G20 started its annual apex-level summit after the 2008 global financial crisis.
• For the first time, the ‘Troika’ will comprise only developing nations.

What is G20 Troika:

• At the G20, the member holding the rotatory presidency every year, works together with its predecessor and successor and is  together known as Troika.
• Aim: to ensure continuity of the agenda of G20.
• Currently Italy, Indonesia, and India are the Troika countries (all developing nations).
• India’s successor will be Brazil.

Significance for India:

• Unique opportunity to look at developments from the perspective of the developing world, turning the tables on the developed country members that have largely set the tone of discussions at the G20.
• Important issues such as food security, rising interest rates, indebtedness among some developing countries, the digital economy or climate change, is likely to be viewed keeping its effect on the poor and the vulnerable strongly in consideration.
• The G20 Presidency is a symbol of honour that comes with presiding over the world’s premier forum for global economic cooperation.

Challenges to G20 Troika:

• Russia-Ukraine war is continuing to wreak havoc on the global economy, disrupting supply chains and creating shortages of food and other essentials. On account of this, member countries continue to be split over the sanctions to be imposed against Russia.
• Unity: Internal governance reform is the need of the hour and India has to give thrust to inclusiveness and unity. This will help in thrashing out a consensus that will go a long way in setting a pragmatic, substantive agenda for the forum.
• Climate financing: developed countries have to be prodded for transfer of clean technologies and renewable energies to medium and low-income countries and India must showcase its exceptional solar energy record while doing so.
• The global economy is in the doldrums and there’s financial instability across the world. Hence, India has to chalk out a roadmap to deal with the situation by teaming up with the International Monetary Fund (IMF), Organisation for Economic Co-operation and Development (OECD), World Trade Organisation (WTO), and the Financial Stability Board.
• Other challenges include taking measures to ensure global food security. India must talk tough on a “code of conduct” for all G20 members and see to it that it is enforced.

Suggestions for future:

• Russia- Ukraine War: India’s decision to stay diplomatically close to the developed countries, such as the US, the UK, the EU, Japan and South Korea, who are calling for increased action against Russia, while continuing to maintain strong trade ties with Moscow, puts it in a unique position of communicating smoothly with both sides.
• The Leaders’ Declaration, based on consensus, was an achievement, as several features are of note, especially those on current political tensions, economic crises and climate change.
• On climate change: Commitments to achieve global net zero greenhouse gas emissions (carbon neutrality) around mid-century and keeping to the 1.5°C temperature limit must be attained.

• Developed countries must be reminded to fulfil their previous commitment to mobilise $100 billion per year “by 2020 and through to 2025”.

• The value of digital technology for multiple sectors — sustainable agriculture, trade, job creation, human capacity development, and inclusive industrialisation — must be reiterated, especially for developing countries.

• It is necessary to acknowledge the impact evident in the economic downturn, increasing global poverty and the delay in achieving the Sustainable Development Goals.

Way forward:

• India’s G20 priorities, as stated by the government, are inclusive, equitable, and sustainable growth, women’s empowerment, digital public infrastructure, and tech-enabled development, climate financing, global food security and energy security, among others.
• This is the moment when India can step forward and transition from being a rule-taker to being a rule-maker.

Source The Hindu Business line