India assumed G20 presidency on December 1, after the gavel was handed over to PM Modi. As the President of the body India will have the power to set agenda and directions for the body for the next year. At a time, when India is being considered as a rising power, the presidency will definitely be a moving point not just for India, but also for the whole world. So, in this blog, we would try to understand, the basics of G20, and the core agenda and challenges around which India’s G20 presidency would revolve around.

What is G20?

G20 is a group of the 20 largest economies, which accounts for 60% of the world’s population, 85% of the world’s GDP and 75% of the global trade. It was set up mainly as a finance minister’s forum at a time of the Asian financial crisis. While the G7’s focus is usually on security and political issues, the G20 focuses on global economic and financial architecture to avert economic crises. The G20 includes developing countries as well as developed ones, namely, Argentina, Australia, Brazil, Canada, China, EU, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, UK and USA. 

India’s G20 logo and message (Photo: India Today)

The Presidency Cycle

First of all, to anyone thinking that a country becoming G20 president is a big achievement, it is not actually the case. The presidency rotates between all the countries ‘alphabetically’. So, after Italy and Indonesia, it is India’s turn before the gavel is handed over to Brazil and then to South Africa. But, being the G20 President means India will be able to decide the core agenda around which the summit will take place. Making the event a grand success will further boost India’s stature at the world level. During the Bali summit, PM Modi had said, “India’s tenure would be decisive, action-oriented and will prove to be a global catalyst for the G20 nations”.

Indonesian President Joko Widodo hands over the G20 gavel to PM Modi (Photo: BQ Prime)

The structure of the G20

There are two major tracks in G20, the Finance track (8 working groups) and the Sherpa track (13 working groups). While the former focuses on the financial structures, the latter focuses on key issues like climate change, the environment and agriculture. Other than this the foreign ministers and finance ministers of the member countries will have their own summits. Plus, 20 different types of groups like youth, science, and business will also come together and have meetings.

Around 200 meetings have been planned across 56 locations in the country with the aim of making the summit a success. At the same time, India is also trying to showcase its soft power, under which it presented the delegates with sand arts in Odisha and kite festivals in Ahmedabad. Amitabh Kant has been appointed the sherpa for the G20 meeting and has the responsibility to coordinate all the activities and report to the government. In his own words, “We will create a uniquely ‘Indian’ experience that is spiritually elevating, mentally rejuvenating, physically envigorating and culturally enriching.”

A still capturing the Russia-Ukraine war (Photo: DW)

Agendas and Challenges

1. Russia-Ukraine War: It’s known that the stand India has taken on the issue of Russia-Ukraine issue is rather unique and courageous at the same time. Although, India has condemned the war (PM Modi’s quote regarding it even made it to the communique), but at the same time, India has not refuted from keeping its business with Russia intact. Now, as the G20 President, almost all major issues (global recession and food supply) will revolve somewhere around this conflict, and India will be have to very articulate in building a consensus between countries. Especially, at a time when the US has openly called out for the ‘removal’ of Russia from the G20, India’s approach will be very crucial in deciding the future outcomes. And, if…if…if India is somehow able to bring anything even near to a ‘settlement’ between the two parties, it would be a HISTORIC achievement. The chief coordinator of G20 Harsh V Shringla has rightly said, “G20 works with consensus, so we’ll have to work with all partner nations to take our initiative forward”. The former Ambassador to Russia has also put it very well, “While, dealing will the Russia-Ukraine issue, India must be like a football referee, ready to run to both sides of the ground without tiring.”  
2. Debt Trap: Over 70 countries in the world, including our two prime neighbours Pakistan and Sri Lanka, have huge debts on their name, so much so that some of them might hardly sustain a few weeks. Here, the role of India and other big countries will be very crucial, on making the arrangements for debt restructuring and help in bailing out these countries.
3. Climate and Energy Crisis: After COP27, the issue of climate change would again be on the top of the agenda. On one hand, the developed countries want the climate temperature rise to come under 1.5 degrees by 2025, but several countries like China, Russia, Saudi Arabia and even India have defended the use of fossil fuels. Their argument has simply been that the transition in fossil fuels should not come at the cost of their development. Building a consensus on this front would be another agenda at the summit.
4. Digital Divide: In this world, around 4 billion people don’t have a digital identity, another  2 billion are unbanked and almost 95 countries do not have a digital payment system. At the same time, India’s JAM (Jan Dhan, Aadhar, Mobile) has actually carried out the world’s largest digital payment system using UPI. So, India will try to use the G20 platform to showcase how the ‘Digital Revolution’ can actually be implemented.
5. Global Value Chain: Building global supply chains would be another prime focus of the summit. Especially, after the chapters of the Covid pandemic and the Russia-Ukraine war, the world is trying to build resilient supply chains, and ‘reduce’ the dependence on China. Now, India can play a very central role in that, after all, India has formed good credibility on that front through its vaccine supply during the pandemic.
6. Corporate Tax Reform: On the front of Corporate Taxation, the big countries are aiming to tax the big MNCs at 15%, across the world. This is aimed to control the problem of tax-free havens. Actually, some small countries keep extremely low tax rates and benefit by attracting MNCs. Now, India’s stand and movement on the issue will be interesting to look at.
7. SDR Divide: Special Drawing Rights (SDR), is an international reserve created by the IMF to help member countries. Although, the allocation is supposed to take place in proportion to the country’s quota at the IMF. But, the advanced countries end up getting a 67% share of the reserve, and the low-income countries are left with just 1% of it. So, to control this staggering divide, India and several countries have demanded a new SDR exclusively focussing on low-income countries. Now, what development happens on this front remains to be seen.
8. WTO Appellate Body: Another rather peculiar issue is regarding the WTO appellate body. The body hears appeals regarding disputes brought by WTO Members. Despite several calls for reform, the body hasn’t been able to replace its retired members for the required Quoram since December 2019. The reason for this is that US President Donald Trump blocked the appointment of judges to it. Whether India’s presidency will be able to get this stuck elephant moving, will be another thing to watch out for.
9. Voice to Global South: Another important point would be giving increasing the representation of the developed countries, especially south-east Asian ones. In a way, it would be giving ‘Voice’ to the ‘Global South’. PM Modi himself has talked about this in his blog, “Our G20 priorities will be shaped in consultation with not just our G20 partners, but also our fellow travellers in the global South, whose voice often goes unheard.” 
10. TRIPS waiver: One of the major limitations of G20 was that it failed in the distribution of vaccines across poor-income countries. Although the production did increase, but out of more than 10 billion doses, less than 1% reached the poor countries. India has regularly called for the removal of barriers like Covid passport and vaccine differentiation. India, Indonesia and South Africa have even asserted that Trade Restricted Aspects of Intellectual Property Rights (TRIPS) should be waived off on vaccines. Although the US has agreed to it, the EU, Germany and UK have opposed any consensus on this front. How this issue pans out under India’s presidency, will be a thing to watch out for.
11. Food Security: A very important issue would definitely be food security, which got badly affected first during the pandemic and then due to the Russia-Ukraine issue. The supply of wheat from ‘Ukraine’ (largest producer of wheat) getting affected, leading to a shortage of wheat worldwide. Now, India has come up with a rather unique proposal of substituting ‘wheat’ for ‘millet’. Millets used to be a staple choice in the West earlier, but today its worldwide production stands at just around 89 million tons compared to 800 million tonnes of wheat. Under India’s proposal, 2023 was also declared as the ‘International Year of Millets’ by the UN at the General Assembly.

India has declared 2023 as the International year of Millets (Photo: FAOUN)

What to expect?

India will definitely try to use its presidency for resolving the problems in the ‘neighbourhood’. It will try to build pressure on Pakistan on the terrorism front. Interestingly, it will come at a time when Pakistan is showing some ‘indications’ of mending ties with India. At such a point, if the two countries come on talking terms, it would be good for the peace in the region, and much better for Pakistan which is struggling with an appalling economy. For Pakistan, it is very important to at least be on talking terms with a rising power in the neighbourhood (other than China).

Also, it would be very interesting to watch out for how India and China interact especially after the recent border standoff. In Bali, there was the first handshake after Galwan, and now as the countries have had another standoff, the interaction between the two leaders would be much more interesting. Especially, when it is India which has the PResidency and the power to decide the agenda. Will China try to remove some issues from the agenda as it did with Indonesia, this will also be a thing to look at. After all “This is not the Era of War” applies very well in this region as well.

PM Modi in his written address after India assumed G20 presidency (Photo: Narendra Modi)

India’s G20 year

Today, India is one of the fastest-growing countries in the world. It has become the fifth-largest economy and will become the third-largest too by 2030-2035. The world especially the West is looking at India as a ‘counter-power’ against China. At this crucial juncture, the G20 Presidency. Also, rather interestingly, India’s term has come at a time just before BJP gears up for the 2024 general elections. So, there shouldn’t be any surprise that India will try to paint and project the “Vishwaguru” image of PM Narendra Modi on the world stage.

Under this, the government would not like the country making news for any wrong reasons. So, 2023, very well has the potential to be the most ‘peaceful’ year in the country despite being a heavy election year (10 elections are scheduled to take place in 2023). Anyways, despite not being any special achievement, the G20 presidency is an important step amid India’s rise to the global stage, and it would be a great experience for all of us as citizens to witness this. I would hereby like to extend my best wishes to the government for the presidency.

“India’s G20 agenda will be inclusive, ambitious, action-oriented, and decisive” – Narendra Modi

JAI HIND