With effect from December 1, 2022, India will assume the Presidency of G20 for a year. It has the dubious distinction of having the lowest HDI to be host in 24 years of G20’s existence. Indonesia, the current Presidency, has almost double India’s per capita income and a better HDI. If the ongoing presidency was Indonesia’s coming out party on the global stage, India has a lot more at stake. It is an opportunity to demonstrate to the world that we are globally the best destination for foreign investment. Our desire is to be next China. For that to happen, the bravado behind ‘Make in India’ needs to be matched by intent on the ground. As host to global leaders, that might begin to happen.
There are many other firsts with India’s Presidency. First the troika (past, current, and future Presidency) will consist of three emerging markets (EMs): Indonesia, India & Brazil. It coincides with the moment when the world needs the G20 to do an encore of what it did post the global financial crisis of 2008.
2008 has been the only demonstrated success of the G20. A crisis that had its roots in the developed world caused by loose monetary policy, shady regulation and compromised governance spread to the rest of the world, demanding coordination among nations that made up 85% of GDP, 75% of its trade and 60% of its population. Consensus happened because EM’s in the mix conformed to the standards set by the West. In the ‘peace’ that has followed since, G20 has been characterised, as a ‘talking shop’.
That peace has been rudely interrupted by war. However, this time is really different because EMs are unlikely to accept authority of the West but in all likelihood challenge it doggedly. In many ways, led by a democratic India, EMs will demand justice for the wrongs of the West that are often conveniently forgotten and consigned to the pages of history.
Just like the World Bank with its headquarters in Washington DC has a resonant and expressive tagline, “Towards a world free of poverty”, the G20 under India’s presidency could well have one that says “Towards a world free of war and full of justice”. India has often been seen as a spokesperson for EMs to help place their interest on the agenda of G20.
After all countries like Bangladesh, that are not on the G20 ‘menu’ fear ending up ‘on the plate’. The ongoing economic crisis of food and energy security, and inflation might have cooperative solutions under the G20, but climate and sustainability are becoming harder by the day. But that doesn’t imply that India should not, along with other EMs, continue to fight for justice.
Many issues that reflect the double standards and astuteness of the West such as reneging on the $100 billion per year climate finance promise and subsequently attempting to include all manner of finance under its scope, singling out coal as a fossil fuel to be eradicated while continuing with others such as oil and gas have shifted from the sublime to the ridiculous. The most egregious of them all will be visible this winter when deprived of gas from Russia for heating homes, Europe will resort to opening its coal-fired power plants. Imports of coal have already started and mining has reopened in China. When things are good, virtues of the market can be extolled for the rest of the world to embrace. When the going gets tough, it is not so easy! External affairs Minister, Jaishankar, got it right when he said there is a mindset in Europe that suggests that when the rest of the world has a problem, it’s their problem but when Europe has a problem it’s the world’s problem.
Consider hurricane Sandy in 2012. It affected one of the world’s most affluent neighborhoods (Fairfax county in the US) and as the hurricane developed it threatened shortages of food and water. The erstwhile law-abiding citizens of the country became resource-grabbing and law-breaking thugs. Stop signs and traffic lights were disrespected, people jumped the queues and shoved to get their hands on the fast-moving items from the shelves.
The market had effectively broken down; imagine the plight of billions of people in EMs who fight for resources every day of their lives and not just episodically. To them, market rules, governance mean nothing. Until justice is delivered the G20 is unlikely to generate consensus anymore. I feel we have turned a corner. The focus on climate justice, ending years of intellectual dishonesty must be brought back to the table. India has an opportunity to do that and of course also exhibit its prowess in diversified fields: yoga, traditional and creative industries, tourism, hospitality and digital sectors. Simultaneously it must bury red tape.
The world needs consensus and cooperation to emerge and G20 obviously has its role cut out. Unfortunately, this crisis is very different. The war in Ukraine has already cast a shadow in Indonesia with President Putin staying away. While he may attend the summit in India next year, the deep-rooted and seemingly irreconcilable differences with the West are likely to hover over India’s presidency as well. This is India’s golden chance!
(The writer is Dean, School of Humanities and Social Sciences & Professor of Economics at Shiv Nadar Institution of Eminence)
