Road Ahead for India’s G20 Presidency
India will be in the driving seat of the G20 in 2023. Promulgating and sustaining its predecessor’s concerns of improved health infrastructure, smooth transition to a digital economy and green energy will be on Delhi’s priority list.
Image Graphics by Team Geostrata
Representing 80% of the world’s GWP, G20 commands great authority. India can use it, not only to its advantage but also to act as a leader leading the agenda of the global south. But it’s not going to be smooth sailing. India’s presidency period is laden with sundry geopolitical affairs which may stymie this paramount grouping of the global north and global south nations.
THE CONUNDRUM OF CONFLICTING NATIONS
The foremost issue is the Russia-Ukraine war which has forced the world's economy to kneel and has also brought in open the new east-west divide. India has pleasing relations with both the US and Russia which brings uncertainty on the part of forming a consensus on issues raised in G20 meetings. Voice has been raised by the US and Australia to kick out Russia from the group whereas China, Russia’s companion, may not agree on the same which further creates an intra-group chasm, hindering its progress.
Although G20 is not a canvas for geopolitics, the existence of bitter diplomatic associations between the biggest economies will indubitably harm its efficacy.
In the G20 foreign ministers meeting held in Bali in July 2022, Russian foreign minister Sergei Lavrov had to face scornful remarks from his counterparts as the fresh war became the focal point of the top diplomats.
No agreements were conceived and the assembly became a geopolitical platform for the nations to condemn and criticise Russia’s imperialist tendencies. This is a testimony to the fact that India may have to face the same situation in future as the feud between Russia and Ukraine seems to continue for eternity.
To achieve its ends, India first has to make sure that political friction doesn’t meddle with superior goals of climate change mitigation and global economy amelioration. For the same, India may have to act as a mediator to end this sanguinary tussle, the possibility of which is high given its commendable balancing relations with both the blocs.
G20 accommodates conflicting nations such as the US and China, which too poses a serious problem on India’s part. “I see stiff competition with China,” said Biden in his first formal news conference, reiterating growing ideological and strategic divergence between the two major global economic drivers. China on its part has maintained conjugal relations with Russia by not taking an explicit stance against the latter on its military operation in Ukraine.
To turn into reality, the utopian goal of global prosperity, these countries would have to work in tandem by keeping aside their war of words and India has to pave the way for the same during its presidency period.
CHALLENGE OF SOLVING ECONOMIC CHAIN REACTIONS
Next in line is the economic challenge. The unfortunate bloodshed has wreaked havoc as every other tension in contemporary geopolitics seems to arise from the same. Rising energy prices, skyrocketing inflation and disruption of food supply chains have unleashed the spectre of recession which has started affecting the masses throughout the world. Relatively smaller economies like India, Saudi Arabia and Argentina have faced these hurdles very well.
The 2022 growth projections of 7.4, 7.6 and 4.0 for the nations aforementioned testifies their policy frameworks whereas goliaths such as US and China are witnessing comparatively low growth forecasts. This puts India at an advantage which it should extract by commanding the G20’s economic policies. Rising inflation entailed a hike in interest rates by central banks which has in turn activated the risk of recession. The US is already in a technical recession and when the US sneezes, every other country gets sick. The current economic scenario may thwart G20’s ambitions of a transition to a digital economy because without solving the broader problem, the specific and narrow ones won’t amass much attention.
WHAT CAN INDIA DO?
G20 has constituted ‘Finance Track’ which dwells upon topics such as financial regulation and international taxation where governors of central banks of member countries deliberate upon the same. It has taken global initiatives of crisis handling (2008 financial crisis and post-pandemic crisis). India has to steer the attention of the finance track towards the current global economic situation aggravated by the conflict.
It has to formally recognize it and sanction its resources and policies to address the same. One of its goals is to fillip ‘sustainable growth recovery’ which is hard to accomplish given the monster of global recession banging on the doors of already worsened economies.
Eventually, all these dilemmas stem from the rough situation at the Russia-Ukraine border. India has hitherto maintained a neutral stance, providing humanitarian assistance to Ukraine and abstaining from voting against its defence equipment trader in the UN which didn’t catalyse peace between the two.
To make full use of its presidency, it is imperative for India to recognize and reinstate the relations among clashing countries otherwise it would have to keep on jumping over the hurdles which will affect the imagined itinerary of bringing about any substantive progress.
BY ABHINAV GOEL