Dr Arvind Kumar*
The G20 has no parallel among intergovernmental forums that comprises of major developed as well as developing economies, thus offering a unique platform. The accession of India to the Presidency coincides with a turning point in world affairs. The political and economic challenges that the world community is confronting are numerous. The crisis in Russia and Ukraine has strained relations between Russia and the affluent Western nations, the majority of which are G20 members. The climate crisis has accelerated, and the conflict in Ukraine will cast a long shadow on the G20 consensus-building efforts. In light of the conflict, many countries face rising debt, poverty and a looming food and energy crisis. The conflict and the subsequent unilateral sanctions imposed by the West have severely damaged supply chain, oil and gas prices, and the post-pandemic global recovery. As always, the most vulnerable, such as developing nations and LDCs, are the ones who are most severely impacted. Although it is the first time that the G20 presidency troika will all be developing countries. New Delhi will need to skillfully navigate this diplomatic minefield and promote efforts to build global consensus on tackling these challenges.
However, can the G20 go any further now that India has taken on this significant role? Can we trigger a profound revolution in thinking that will benefit humankind? I think we can.
India should strive to identify workable global solutions for everyone’s well-being in the real spirit of Vasudhaiva Kutumbakam (the world is one family). The fast change of India’s economy and society, especially the green and digital transformations, initiated by the Prime Minister, has crafted India’s vision for the global development agenda. The pandemic’s aftereffects are especially significant because they highlighted the necessity of robust healthcare and international cooperation. The G20 presidency of India, which begins in December, offers a historic chance to advance inclusive development among all people `and states; providing with a chance to become a leader in the renewable energy industry and a voice for the developing world. But how do we make it a reality?
In 2022, many nations saw the effects of global warming, including heat waves in India and throughout Europe, as well as floods in Pakistan and Puerto Rico. The effects of climate change are especially severe in developing nations. A draft communiqué from the recent meeting in Bali identified three top concerns as a sustainable economic recovery, land- and ocean-based climate action, and resource mobilization to boost environmental protection in support of the Paris Climate Agreement. It has also been acknowledged that as a whole, we have failed to bring these components within and among us into harmony.
We should embrace the platform provided by India’s G20 leadership to advance the sustainable development goals and address all pertinent challenges, including poverty, food security, health, and the environment. A special intergovernmental forum for emerging and developed nations is the G20, or the group of 20. A rotating presidency enables a nation to establish a schedule that would further the G20’s goals while mainstreaming national issues. India should share its experiences, lessons learned, and role models with the world, especially the developing world, as potential models. Not just our G20 partners, but also our fellow travelers in the global south, whose voice is sometimes ignored, should be consulted when developing our G20 priorities.
The G20 has made energy and climate change a priority. For instance, in 2012, under Mexican presidency, G20 introduced inclusive green growth as a cross-cutting priority on the G20 development agenda; in 2015 it stressed member nations to ratify the Paris Agreement and timely submit their Intended Nationally Determined Goals (INDCs). It also promoted increased capital mobilization for green energy and strategies for de-carbonization without compromising energy access goals through its work streams, such as the Sustainable Finance Working Group (SFWG) and Energy Transition Working Group (ETWG), and engagement groups, such as the Think 20 (T20).
India stands out among the G20 nations, according to a recent working paper by the Economic Advisory Council to the Prime Minister, since it has the strongest trend growth from 2015 to 2019 and is growing faster than even lower-middle income nations. India is projected to accomplish the SDGs by 2059 based on current trends. This paper suggests that as resources are scarce in underdeveloped countries, we must prioritize the indicators. Therefore, it is not surprising that India’s presidency will prioritize energy security, green hydrogen, sustainable development objectives, and climate finance. These issues were crucial throughout the 2019, 2020, and 2021 presidencies, respectively, and were topics of extensive discussion during recent Indonesia’s G20 chairmanship as well.
Amitabh Kant, the Sherpa for India at the G20, reaffirmed that the developed world has only made a small progress in addressing climate change, and that climate financing will be a major topic of debate during India’s presidency. India has pledged to achieve net zero emissions by 2070 and to meet 50% of its energy needs with renewable sources by 2030. Recently, a number of industrialized economies, including the EU, Canada, Germany, the U.K., Japan, and the U.S., extended their pledges to climate funding through 2025. However, there is still a long way to go because by 2030, emerging economies would need around US $2 trillion to fulfill their climate pledges.
India should therefore emphasize the delivery of finance in accordance with prior commitments, an improved private sector partnership, access to a global pool of environmental, social, and governance (ESG) capital, the necessity of reorganizing multilateral institutions like the World Bank, IMF, and WTO for raising SDG finance, as well as taking care of developing countries’ debt issues. Given the current geopolitical situation, certain concerns associated with global capital access, such as monetary policy glitches, inflation, and interest rates, require debate. For a thorough discussion, it is vital to look at country case studies of creative financing methods, such as blended finance for de-risking capital, especially for emerging technologies like battery storage, offshore wind, and green hydrogen. Regarding SDG financing we should adopt six pathways as prepared by Jeffrey Sachs. The first of these is an increase in domestic tax revenues. The second is an increase in sovereign (government) borrowing from international development finance institutions (DFIs). The third is an increase in sovereign borrowing from international private capital markets. The fourth is an increase in official development assistance (ODA). The fifth is an increase in funding from private foundations and philanthropies. The sixth is a debt restructuring for borrowers who are heavily indebted, primarily to lengthen maturities and lower interest rates. India can help some of these approaches get traction.
In conclusion, India has a vital role in addressing these challenges as a country highly committed to multilateralism and a zealous advocate of inclusiveness and equity in the global governance system. With the above-discussed priorities, India can take the lead in moving forward with the G20 agenda of inclusive green growth and sustainable development. The challenges that the world faces are so enormous that geopolitical conflict and rivalries should not be allowed to crowd out or derail the important work of the G20. The way forward lies through diplomacy and dialogue.
*President, India Water Foundation
