The 19th G20 Summit in Brazil on Monday and Tuesday will bring leaders of all major economies together once again. The task before them is cut out.
Prime Minister Narendra Modi is representing India for a record eleventh successive time. Such continuity is an advantage in a world of turmoil...when there is a deficit of global governance. Nothing is more powerful than the force of example.
Since the first G20 Summit in 2008, and particularly since 2014, India has been a source of economic stability and growth. India, the fastest growing large economy, has quadrupled its GDP to almost $4 trillion since 2008. It is on track to become the third-largest economy in the next few years.
The G20 has been good for India, just as India has been good for the G20. India managed an impossible consensus at the Delhi Summit last year. It brought balance by reminding the world, when most needed, that the South is a reality and must be heard. Africa was given representation. India came with solutions such as its iconic digital public infrastructure initiative.
The G20 process is dovetailed with India’s philosophy of ‘Vasudhaiva Kutumbakam’. We have entered an era where neither the G7, with its outreach activity, nor the BRICS, with its expanded membership, can by themselves solve the world’s problems. The way forward lies in cooperation. India also wants to keep the world’s attention focused on the development and reform agenda.
The Rio Summit is part of a golden run for the South. By 2025, four major developing economies would have hosted the G20 Summit back-to-back, with South Africa hosting the summit next year.
It is unfortunate that the West, or the North, regards the South as trade unionism. They would rather do without it, and if they cannot, they draw comfort from its internal differences.
The three priority areas of Brazil’s G20 presidency echo India’s – social inclusion and the fight against hunger and poverty; energy transitions and the promotion of sustainable development; and reform of global governance institutions.
India will support Brazil’s initiatives, including the launch of a Global Alliance against Hunger and Poverty. An IBSA conversation is also likely to happen.
This does not mean complete identity of views between India and Brazil or South Africa on major conflicts and issues. Nor does it mean confrontation with the North. Given the challenges facing the global economy, it is in the interest of all sides to work together.
Major economies like the US, Europe and China are subdued. US debt has reached record levels, jobs are scarce there and inflation is hurting. Europe faces inflation and declining competitiveness. In addition, the long and uncertain shadow of Trumpism looms over the global economy. The resounding mandate received by Donald Trump for revival of the US economy and to ‘make America great again’ will change the way the US deals with the world. In particular, it will change the way the US and China, the two largest economies, deal with each other. At a minimum, competition between the two is poised to become more acute.
Geopolitical tensions are likely to grow in the foreseeable future. Areas that fall under the G20 agenda stand politicised and weaponised. This could well get worse. Policies relating to trade, investment, technology, manufacturing, supply chains, capital and currency flows, and restrictions on movement of labour will be increasingly used to defend national interests and inflict damage.
The G20’s ability to contain the fallout and prevent secondary and tertiary economic, trade and technological fragmentation of the world and inward-looking tendencies will be severely tested.
Nations that are lucky to have the capability will seek to firewall themselves and aim to become more self-reliant. The less fortunate will become even more vulnerable. The G20’s immediate task is damage limitation. This is a process and not a one-off exercise.
The question of pushing the positive agenda of generating the political will and resources to address the real and urgent needs of climate finance, debt restructuring, resource and capital mobilisation, job creation, education, reducing inequality and food insecurity can be addressed only if there is agreement on the basics. The same applies to reform of the international financial, trade and development architecture, of which there is much talk but little appetite.
The G20 was born in response to a crisis of capitalism in 2008. Today, the free-market system and the international economic order face the challenge of adapting to sustained and intense geopolitical contestation. The G20 must defy the odds to build a new global consensus, howsoever difficult it may be, on inclusive, balanced and sustainable growth. India is ideally suited to contribute to this for many reasons.
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com)
Prime Minister Narendra Modi is representing India for a record eleventh successive time. Such continuity is an advantage in a world of turmoil...when there is a deficit of global governance. Nothing is more powerful than the force of example.
Since the first G20 Summit in 2008, and particularly since 2014, India has been a source of economic stability and growth. India, the fastest growing large economy, has quadrupled its GDP to almost $4 trillion since 2008. It is on track to become the third-largest economy in the next few years.
The G20 has been good for India, just as India has been good for the G20. India managed an impossible consensus at the Delhi Summit last year. It brought balance by reminding the world, when most needed, that the South is a reality and must be heard. Africa was given representation. India came with solutions such as its iconic digital public infrastructure initiative.
The G20 process is dovetailed with India’s philosophy of ‘Vasudhaiva Kutumbakam’. We have entered an era where neither the G7, with its outreach activity, nor the BRICS, with its expanded membership, can by themselves solve the world’s problems. The way forward lies in cooperation. India also wants to keep the world’s attention focused on the development and reform agenda.
The Rio Summit is part of a golden run for the South. By 2025, four major developing economies would have hosted the G20 Summit back-to-back, with South Africa hosting the summit next year.
It is unfortunate that the West, or the North, regards the South as trade unionism. They would rather do without it, and if they cannot, they draw comfort from its internal differences.
The three priority areas of Brazil’s G20 presidency echo India’s – social inclusion and the fight against hunger and poverty; energy transitions and the promotion of sustainable development; and reform of global governance institutions.
India will support Brazil’s initiatives, including the launch of a Global Alliance against Hunger and Poverty. An IBSA conversation is also likely to happen.
This does not mean complete identity of views between India and Brazil or South Africa on major conflicts and issues. Nor does it mean confrontation with the North. Given the challenges facing the global economy, it is in the interest of all sides to work together.
Major economies like the US, Europe and China are subdued. US debt has reached record levels, jobs are scarce there and inflation is hurting. Europe faces inflation and declining competitiveness. In addition, the long and uncertain shadow of Trumpism looms over the global economy. The resounding mandate received by Donald Trump for revival of the US economy and to ‘make America great again’ will change the way the US deals with the world. In particular, it will change the way the US and China, the two largest economies, deal with each other. At a minimum, competition between the two is poised to become more acute.
Geopolitical tensions are likely to grow in the foreseeable future. Areas that fall under the G20 agenda stand politicised and weaponised. This could well get worse. Policies relating to trade, investment, technology, manufacturing, supply chains, capital and currency flows, and restrictions on movement of labour will be increasingly used to defend national interests and inflict damage.
The G20’s ability to contain the fallout and prevent secondary and tertiary economic, trade and technological fragmentation of the world and inward-looking tendencies will be severely tested.
Nations that are lucky to have the capability will seek to firewall themselves and aim to become more self-reliant. The less fortunate will become even more vulnerable. The G20’s immediate task is damage limitation. This is a process and not a one-off exercise.
The question of pushing the positive agenda of generating the political will and resources to address the real and urgent needs of climate finance, debt restructuring, resource and capital mobilisation, job creation, education, reducing inequality and food insecurity can be addressed only if there is agreement on the basics. The same applies to reform of the international financial, trade and development architecture, of which there is much talk but little appetite.
The G20 was born in response to a crisis of capitalism in 2008. Today, the free-market system and the international economic order face the challenge of adapting to sustained and intense geopolitical contestation. The G20 must defy the odds to build a new global consensus, howsoever difficult it may be, on inclusive, balanced and sustainable growth. India is ideally suited to contribute to this for many reasons.
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com)
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