Working workables makes G20 relevant

G20 finance ministers and central bankers made incremental progress on a host of agenda issues from debt relief to climate commitments to crypto regulation. This is in line with expectations of slow but steady progress in coordinated economic response and regulation in the aftermath of health and energy crises and monetary action by central banks to tackle inflation. As US secretary of finance Janet Yellen emphasised that sanctions against Russia would be tightened, G20 admitted it is not a forum to resolve security issues. It, however, needs to take a proactive stance on the global economic outlook that has improved in the last six months but still faces significant downside risks in elevated inflation, a resurgence of the pandemic and rising debt distress amid global monetary tightening.

Under India‘s presidency, working groups have been tasked with mapping the global debt landscape, assessing food and energy security, reviewing the capital adequacy framework for multilateral development banks, outlining enablers for inclusive cities, drawing up options to support climate investments and transition activities, developing the analytical framework for enabling finance for Sustainable Development Goals, and working towards a coordinated approach to regulating cryptocurrencies. The big issues like debt, geopolitical tension and liquidity squeeze by advanced economies elude consensus. But G20 increases its relevance by working on the less intractable ones.

This bears testimony to India’s economic diplomacy where it has taken positions in self-interest such as securing energy from Russia, unilaterally extending debt relief to Sri Lanka, announcing national energy transition goals and moving forward regulation of cryptocurrencies. India has positioned itself well in a new world economic order through structural changes that are exploiting technology and shifting geopolitical alliances. India’s presidency represents work in progress to build back better. That, in itself, is a considerable achievement in these extraordinary times.