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How G20 formed and What Importance it holds for INDIA?

Updated: Nov 19, 2022

Recently, the Prime Minister of India went to Bali, Indonesia where the leaders of other nations were also present except the Russia, for obvious reasons, that is due to Russia - Ukraine war. Some media outlets termed that there was a life threat to Russian President Vladimir Putin and he might have been shot dead by the CIA if he had come to the G20 summit, but who knows. One thing is clear that he didn't attend and the west must have enjoyed Russia being felt isolated. Also, India will start the presidency of G20 from 1 December 2022. Let's know of what G20 is and how actually the grouping formed?

Image is sourced from Twitter handle of Pm- Narendra Modi

The origin of G20

Officially it was formed in 1999, although it does not have any official charter or permanent secretariat. It's background goes to the end of the decade of 1990s as world was facing financial problems (during 1997 - 1999) and USSR was no more (it broke in 1991) and the finance ministers of G7 nations (which include - USA, UK, Germany, Italy, Japan, Canada, France) met and suggested to include other emerging economies as well and form a bigger grouping of the finance ministers and governors of the central banks. Subsequently after nine years, leaders (that is the Presidents and Prime Ministers) of the G20 nations met in November 2008, earlier it was a regular meet up of finance ministers and the central bank governors. In addition to that, the Sherpa meetings, that oversee all the negotiations, working groups, and special events are also organized throughout the year.

(To give bit of background , leaders of nations met in 2008 as USA and the World experienced a hit economically, when housing prices fell and homeowners began to abandon their mortgages, the value of mortgage-backed securities held by investment banks declined in 2007–2008 )

Who all are members of G20?

The members of the G20 are: Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom, the United States, and the European Union. Spain is also invited as a permanent guest.

The country of influence but not in the list?

It is Australia and New Zealand and some from Gulf. So, Australia works collaboratively and constructively with the G20 to support an open, global economy and the rules-based multilateral trading system.

How G20 works?

G20 website says, "The presidency of the G20 rotates every year among its members, with the country that holds the presidency working together with its predecessor and successor, also known as Troika, to ensure the continuity of the agenda. Currently Italy, Indonesia, and India are the Troika countries."

The pinnacle of the G20 work in each cycle is a communiqué expressing members’ commitments and vision for the future, drafted from the chosen recommendations and deliverables from ministerial meetings and other work streams.

So together its members account for more than 80 per cent of world GDP, 75 per cent of global trade and 60 percent of the population of the planet. In addition it brings 10 Engagement groups that brings the civil society, parliamentarians, think tank, women, youth labor, businesses and researchers.

What it means for India as it begins it's Presidency?

Prime Minister Modi tweeted, "India will assume the G-20 Presidency for the coming year. Our agenda will be inclusive, ambitious, decisive and action-oriented. We will work to realise all aspects of our vision of ‘One Earth, One Family, One Future.’"

India will be 18th head after the Indonesia, the summit will take place from 9- 10 September 2023 in India.

For India as a President it will mean that it can turn the discussion in the directions it prefers. That means it can talk of issues the world is facing and emerge as a global leader on those issues. Also, India will be supported by the Troika, that is the Indonesia and Brazil along with India during its presidency.

The G20 secretariat has the responsibility of overall implementation of the policies and decision, from India it will be former foreign secretary Harsh V. Shringla and Sherpa will be former IAS and NITI Aayog CEO for 6 years, Shri Amitabh Kant.

The key Agenda for India will be the much needed reforms in World Bank, IMF and WTO as per the current times so the agenda of G20 is fulfilled that is the economy of the world.

The institutions life World Bank, IMF and WTO hold much power in the world and these have certain issues as they haven't been always fair to the developing nations. The loans supplied are on harsh terms that holds the power to colonialize a nation through capitalism from the west.

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