G20
Introduction:
The G20 is a significant international forum that includes 19 countries and the European Union, representing most of the world's largest economies. The G20 was established in 1999 in response to global economic crises, and its members meet at least once a year to discuss economic issues and coordinate policies. The summit involves high-ranking officials from each member country, including heads of government or state, finance ministers, and foreign ministers. The EU is represented by the European Commission and the European Central Bank.
Chair rotation:
The G20 Presidency rotates among its member countries, with one member country holding the position for a year at a time. To determine which country will hold the Presidency for a given year, the G20 members, excluding the European Union, are divided into five groups. Each group has a turn to hold the Presidency, and the members within the group must negotiate among themselves to decide which member will take on the role of G20 President for that year. This system ensures that the G20 Presidency is distributed fairly among its members.
Organization
The G20 operates without a permanent secretariat or staff, and the current chair sets up a temporary secretariat for the duration of its term. India and Brazil are set to host the G20 summits in 2023 and 2024, respectively. In addition to the 20 members, the chief executive officers of several other international forums and institutions are also invited to participate in G20 meetings.
Inception of G20
The G20 was founded in 1999 after the Asian financial crisis of 1997-98 as an informal forum for the Finance Ministers and Central Bank Governors of the most important industrialized and developing economies to discuss international economic and financial stability.
Elevation to Leaders’ level
The G20 was upgraded to the level of Heads of State/Government in the wake of the global economic and financial crisis of 2007, and in 2009, when it became apparent that the necessary crisis coordination would only be possible at the highest political level. Since then, the G20 Leaders have met regularly, and the G20 has become the premier forum for international economic cooperation. The G20 Summit is held annually, under the leadership of a rotating Presidency. The forum initially focused largely on broad macroeconomic issues, but it has since expanded its agenda to inter-alia include trade, climate change, sustainable development, health, agriculture, energy, environment, climate change, and anti-corruption.
Guest Countries and Invited International Organizations
In addition to the member countries, i.e. 19 countries (Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Türkiye, United Kingdom, and the United States) and the European Union, each G20 Presidency invites other guest countries and international organizations (IOs) to participate in the G20 meetings and Summit. India will be inviting Bangladesh, Egypt, Mauritius, the Netherlands, Nigeria, Oman, Singapore, Spain and UAE as guest countries during its G20 Presidency. For Guest IOs, India will be inviting ISA, CDRI and ADB in addition to the regular G20 International Organizations (UN, IMF, WB, WHO, WTO, ILO, FSB and OECD) and Chairs of Regional Organizations (AU, AUDA-NEPAD and ASEAN)
Guest Countries and Invited International Organizations
In addition to the member countries, i.e. 19 countries (Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Türkiye, United Kingdom, and the United States) and the European Union, each G20 Presidency invites other guest countries and international organizations (IOs) to participate in the G20 meetings and Summit. India will be inviting Bangladesh, Egypt, Mauritius, the Netherlands, Nigeria, Oman, Singapore, Spain and UAE as guest countries during its G20 Presidency. For Guest IOs, India will be inviting ISA, CDRI and ADB in addition to the regular G20 International Organizations (UN, IMF, WB, WHO, WTO, ILO, FSB and OECD) and Chairs of Regional Organizations (AU, AUDA-NEPAD and ASEAN)
Initiatives
Research and Innovation Initiative Gathering Research and Innovation Initiative Gathering (RIIG), besides the Sherpa Track Working Groups, aims to enhance, intensify, and strengthen research and innovation collaboration among the G20 member countries. RIIG is furthering the work of the Academic Forum held during the Italian Presidency in 2021, by bringing together science, technology and innovation experts of the G20 member countries.
G20 EMPOWER
The G20 Alliance for the Empowerment and Progression of Women’s Economic Representation (G20 EMPOWER) was launched during the G20 Osaka Summit in 2019. It aims to accelerate women’s leadership and empowerment in the private sector by leveraging its unique alliance among business leaders and governments across the G20 countries.
SPACE ECONOMY LEADERS MEETING
Under India’s G20 Presidency, Indian Space Research organization/ Department of Space (ISRO/DOS) is organizing the 4th edition of the Space Economy Leaders Meeting (SELM) to continue the deliberations on the significance of space in shaping the global economy. The previous editions of SELM were organized by the Saudi Space Commission (2020), Italian Space Agency (2021) and National Research & Innovation Agency, Indonesia (2022). Considering importance of New Space in shaping the global economy, the theme for this year’s SELM is “Towards a New Space ERA (Economy, Responsibility, Alliance)”.
Engagement Groups
As part of the G20 members' commitment to consult relevant stakeholder communities, dialogue is facilitated through the engagement groups, comprising nongovernment participants from each G20 member. These groups often draft recommendations to the G20 Leaders that contribute to the policy-making process. The engagement groups are as follows:
- Business20
- Civil20
- Labour20
- Parliament20
- Science20
- SAI20
- Startup20
- Think20
- Urban20
Women20
- Youth20
G20 Agenda
Financial Focus
The original G20 plan centered around ensuring the sustainability of sovereign debt and promoting global financial stability through an inclusive approach that would treat major developing economies as equal collaborators.
In subsequent G20 meetings, the key topics of discussion have primarily revolved around issues such as worldwide economic expansion, regulation of international trade, and financial market oversight.
Inclusive growth
Following the adoption of the UN Sustainable Development Goals and the Paris Climate Agreement in 2015, the G20 agenda expanded to include a broader range of "global significance" issues. These new topics included migration, digitization, employment, healthcare, economic empowerment of women, and development aid.
G20 and India
India's involvement in the G20 process reflects the recognition that, as a significant developing economy, India has a critical interest in preserving the stability of the global economic and financial systems. When participating in G20 Summits, India is driven by the following objectives:
- Promoting greater inclusivity within the financial system
- Discouraging protectionist measures
- Ensuring that the growth prospects of developing nations are not adversely affected.
India’s Thrust Areas in G20
Terrorism
Combatting terrorism at the international level is critical since the roots of terrorism may lie in one country, the planning could occur in a second country, and the intended target could be a third nation, such as India. To effectively address this challenge, there must be a coordinated global effort, particularly with regard to the financing of terrorist networks, which flows in from various parts of the globe. The G20 can be utilized to leverage the collective strengths of countries facing similar issues to confront the threat of terrorism.
Economic Offenders
India considers tackling economic offenders to be a significant policy challenge, not only for itself but also for other countries within the G20. At the Osaka Summit, India restated its commitment to this issue, proposing the idea and requesting cooperation from other G20 member states. This suggestion has been well-received by other countries within the group.
Taxation
The G20 is faced with the challenge of addressing global taxation issues. To this end, the group has acknowledged the importance of the Base Erosion and Profit Shifting (BEPS) framework. However, as global supply chains and e-commerce continue to expand, this framework must be further fortified to address the challenges posed by these developments.
New Digital Technologies
The rapid pace at which digital technologies are advancing and spreading globally has significant implications. While digital technologies have the potential to drive economic growth and facilitate social development, there are concerns regarding privacy, data security, and digital governance that need to be properly understood and addressed. Therefore, India is collaborating with other countries to mitigate the vulnerabilities and ethical concerns associated with these technologies.
G20 and India: Going forward
In 2023, India is set to assume the presidency of the G20 and will need to develop a framework on digital technology that is acceptable both domestically and internationally. One of the key challenges India must address is the growing protectionism around digital technologies. This can be achieved by addressing two crucial shortcomings resulting from the unregulated development of the internet: a lack of trust in the protection of private citizen data by foreign entities and large digital divides that have skewed the benefits of digitalisation towards a few nations.
India can also propose a working group to discuss cross-border flows of health data and adequacy requirements for telemedicine, leveraging the experiences of the G20. India could pilot a ‘digital twins’ initiative that would pair cities across member nations and assist them in implementing digital infrastructure projects to bridge infrastructure gaps across member states.
Moreover, India could propose to expand the scope of open government data principles beyond the realm of anti-corruption and emphasise the creation of a standardised, interoperable, integrated cloud framework to enable the seamless sharing of data available with different levels of government. This unified framework could help administrations arrive at policy decisions based on evidence and verifiable data.
In conclusion, India's success in its tenure as the G20 president hinges on its ability to demonstrate its status as an inclusive, responsible, and mature digital powerhouse.
G20: Challenges and Way Forward
Coordination on reducing discriminatory taxation
the G20 has recognized the need to address tax issues, particularly those related to multinational corporations, to ensure a fair and competitive global market. One area of focus has been on the Base Erosion and Profit Shifting (BEPS) framework, which aims to prevent corporations from artificially shifting profits to low-tax jurisdictions. However, there is still a need for further progress in this area, as well as in addressing other tax-related issues such as indirect taxation and credit requirements. Rationalizing the tax structure and ensuring parity in credit requirements can help create a more level playing field for businesses and promote a more competitive market structure.
Climate change
To invest more in developing countries to mitigate and adapt to climate change.
The G20 has committed to mobilizing financial resources to support developing countries in their efforts to tackle climate change. In 2009, developed countries pledged to mobilize $100 billion per year by 2020 to support developing countries in their efforts to tackle climate change. However, this target has not yet been met, and there are concerns about the lack of funding available to support developing countries in their efforts to address climate change.
The G20 has recognized the importance of addressing climate change and has committed to supporting the implementation of the Paris Agreement. The Paris Agreement is a global agreement to combat climate change, and it aims to limit global warming to well below 2 degrees Celsius above pre-industrial levels, with a target of limiting warming to 1.5 degrees Celsius.
To support the implementation of the Paris Agreement, the G20 has committed to taking action to reduce greenhouse gas emissions and to promote the use of renewable energy. The G20 has also committed to supporting the development of climate-resilient infrastructure and to promoting sustainable agriculture.
In addition to these commitments, the G20 has also recognized the importance of promoting climate finance and has committed to mobilizing financial resources to support the transition to a low-carbon economy. The G20 has also recognized the importance of promoting private sector investment in climate change mitigation and adaptation, and has committed to promoting the development of innovative financing mechanisms to support these efforts.
Overall, the G20's focus on climate change is an important step towards addressing this global challenge. However, more needs to be done to ensure that the commitments made by the G20 are met, and that developing countries receive the support they need to address the impacts of climate change.
Reducing corruption
Corruption is indeed a major hindrance for equitable development in developing countries, and it can be challenging to see its impact at the grassroots level even with efforts from international diplomacy. Under the German Presidency, the G20 is indeed focusing on measures to improve public sector integrity and the common search for ways to fight corruption in particularly susceptible areas. The G20 Anti-Corruption Working Group has been working towards strengthening legal frameworks and enhancing international cooperation to combat corruption, money laundering, and illicit financial flows. The group has also been focusing on promoting transparency, integrity, and accountability in public and private sectors, including through the use of digital technologies.
