Indian economy set to get a G-20 boost

In many ways, discussion in groups like the G-20 can be more effective than large and static bodies.

Eager to take over the presidency of the G-20 in 2023, India has been quick to list the agenda for the 200-odd summits that will culminate with the Summit in New Delhi next September. The local authorities have given hope of delivering big and sustainable results on various problems. He expects many of these to have a positive impact on India, including on the Indian economy, which has struggled of late in dealing with GDP growth, employment growth and a widening deficit.
Due to its new position, there is bound to be a strong impact on India as it is closely related to various issues of the day and various groups of prominent countries – these include the developed countries of the G-7 (US, UK, France, Germany, Italy, Canada and Japan ), the entire group of 27 European countries through membership of the European Union, the developed countries of Russia, China, Saudi Arabia, South Korea, Turkey and Australia, and the developing countries of Brazil. , South Africa, Argentina, Mexico and Indonesia.
Benefits will include India’s exposure to economic best practices in developed countries, cross-border cooperation, and access to sources and markets for improved trade in goods and services. Although the planned meetings will provide solutions to many problems, they will be informal meetings between heads of state at the last meeting of the year, or between ministers and other officials throughout the year. to clear several pending hurdles in India’s relations with other 19 members.
Many of the global and Indian economic problems are the result of recent political events, particularly the war in Ukraine, the destabilization of China, and climate change. In mitigating this storm, the G-20 can play a major role. The body derives great pleasure from the influence of its members – together, the G-20 accounts for 85% of global GDP, 75% of global trade, and 65% of the world’s population. Its expansion in 1999 from the G-7 to the G-20 with other major developing countries included, as well as the promotion from finance ministers and Central Bank governors to meetings of Heads of Government, has meant that the Group’s position on various issues of the world. be very sensitive.
With the role of Prime Minister Narendra Modi in the world, and on both sides of the conflict in Ukraine which continues to be in conflict with India, the G-20 meeting under the leadership of Modi would be good for India to play a major role. Ending the war can help solve the global energy and food crisis. Due to the looming recession in developed countries, global trade growth, which has slowed to 1%, should pick up again. This would help revive Indian exports and lower import costs, which have been on the rise due to sharp increases in the prices of crude oil, natural gas and fertilisers.
In fact, in many ways, negotiations in groups like the G-20 can be more effective than the large and static organizations of various United Nations agencies and multilateral banks where prepared documents are often issued, without proper exchange. or thoughts. to discuss important issues. In addition to ending the war in Ukraine, the economic and financial crisis seen in the use of energy at the COP-27 in Glasgow, can also be addressed by the small and united group of the G-20. Reaching consensus on setting national goals for energy transition and coordinating international action on energy efficiency can also be tested for the first time at the G-20 games that will lead to the next COP.
Addressing foreign trade concerns is another area where the G-20 can be useful. India’s pending Free Trade Agreements (FTAs) are, almost all, with the developed countries of the UK, the US and the European Union, with Canada a recent addition. Despite the reduction or elimination of the import tax on many products, there is often a preliminary agreement, the areas of dispute remain on data protection, IPR, labor management and export of agricultural products. Much of this “disagreement” of developed countries also applies to other developing countries, both in the G-20 and outside. Resolving these issues through regular sessions, as well as side meetings between the government officials involved, can help narrow the gap and speed up the completion of the agreements. Similarly, the countries of the “Global South” in the G-20 can come together to present a strong case to the Western countries to give them access to their trade and services, and to force them to avoid a sudden rise in employment. from them or deliberately decide to end the status of Most Favored Nations (MFN), as happened in the Trump Administration in the US not so long ago.
Given the fact that the work of many international organizations such as the IMF, the World Bank, WHO and FAO is heavily influenced by donors – all of them are in the developed countries of the G7 such as India, Brazil, Indonesia, and the South. Africa would do well to seek to improve their lending practices. Local problems require local solutions, not the commercial solutions often pushed by lenders. It is clear that the recommended solutions that are often given by experts at the IMF and the World Bank as a guide to providing aid to underdeveloped countries, such as restructuring large enterprises, should be avoided. The unique advantages and disadvantages of the borrower countries should be a way to determine and not the systems that would work in the capitalist circles. The G-20 talks being proposed to India should be aware of this in their discussions.
At the end of the day, the G-20 meetings in India may not completely solve the economic problems of any country, including India. However, this may lead to an opportunity to contribute to the resolution of international conflicts and to explore ways of influencing countries. Year-long discussions between hundreds of senior officials and ministers will undoubtedly have results. Considering India’s strategic planning as a host country, and our global expansion, many countries should sympathize with India.

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Dr Ajay Dua, an economist by training, is a former Union secretary.

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