G20 or Group of 20 is a global forum to discuss important financial and economic policies. It is a multilateral platform where developed and emerging economies unite.
The G20 members are the representative of more than 80% of the World’s economy, 60% of the world’s population, and more than 75% of international trade.
•History of G20:
In 1999, a meeting between the finance minister and the Governor of the Central Bank of India was organized in order to discuss the implementation of various policies to tackle the financial and global economic crisis. In recent times, 19 countries including Russia, the US, Argentina, Mexico, Turkey, China, Japan, South Korea, Indonesia, Britain, Saudi Arabia, India, Germany, Indonesia, Australia, Brazil, France, Canada, and South Africa are part of the G20 presidency.
As soon as the G20 presidency was formed, their main concern was to tackle the economic crisis and to come up with the best solutions as soon as possible.
Under G20, we have two channels:
1) Financial track- It consists of Central Bank Governors and Finance minister. They discuss all the financial and economic problems and the ways to tackle these problems.
2) Sherpa track- They are appointed by the head of Government or head of the country and they discuss things other than the financial sector problems.
In order to conduct the summit smoothly, the ‘troika’ i.e. the upcoming presidency, current presidency, and the previous year’s presidency are responsible to cooperate and communicate with each other every year.
The first summit was held in Washington DC in 2008. During this summit, a general agreement was formed in order to achieve economic growth.
The first summit was followed by another summit which took place in Pittsburgh in 2009. This summit helped in establishing G20 as a major decision-making body and they regulated strict guidelines for too-big-to-fail banks.
• G20 summit of 2021:
A two-day summit was organized in Rome on the 30th and 31st day of October 2021. Climate change, COVID, and Carbon neutrality are some of the issues which were highlighted during the meeting. The economy of the World is still recovering after COVID hit the nation.
During the summit, the G20 promised to work to improve the country’s economic and social issues. Countries came together for COP26, a UN Climate conference that took place in Glasgow, UK.https://tdznkwjt9mxt6p1p8657.cleaver.live/liverpool-in-race-to-sign-leicester-city-star/
At the end of the summit, everyone signed a declaration to lower down global warming to 1.5 degrees in comparison with the pre-industrial level, they even promised to provide Vaccines, therapeutics, and diagnostics while ensuring uplifting the health of the nation.
• Problems India may encounter during the G20 presidency:
As India prepares for the G20 summit, it is its responsibility to address some of the major issues and conflicts going on all around the world. There are several questions that India may come across while organizing the Summit, primarily the Russia and Ukraine conflict.
The global debt level has been elevated to another level because of the pandemic and the Russia-Ukraine crisis. According to the recent Indian Monetary Fund, World Economic Outlook In 2021, the average emerging market and middle-income countries had a debt-to-GDP ratio of roughly 60%, up from 40% in 2013—the year of the taper tantrum. Similarly, it was twice as much for low-income countries in 2021 as it was in 2013.
The Finance Minister and Central Bank Governors meeting analyzed during G20, 2020 that in order to get relief from the debt, we may require it beyond the debt Service Suspension Initiative. Now with the strict monitory policy’s rules and regulations and the discontinuation of DSSI( debt Service Suspension Initiative), it becomes important that the framework is fully built and immediately provided.
India may be pressurized because of the Russia’s exclusion from the G20 summit. It seems certain that the status quo for Russian President Vladimir Putin will prevail—at least for the time being—given that the gathering’s forum is for economic cooperation and not for political dialogue.
As war between Ukraine and Russia continues, there are high chances of nations questioning India regarding it’s political, social and economic relations with Russia. Important international forums like the G7 and G20 have been troubled by Russia’s threat to use nuclear weapons in the Baltic region if neutral nations like Finland and Sweden relent to NATO membership. This is especially true for nations like India that have long advocated loudly for nuclear disarmament
India is also going to focus on the post-COVID recovery as many nations have been badly affected by the Pandemic.
