The discussion on the global economic outlook and risks at the second G20 framework working group (FWG) meeting, under the Indian G20 presidency, emphasised on the need to continue efforts to manage global inflation and remain vigilant to emerging financial risks.
The members also deliberated on how food and energy prices remain elevated in many economies, disproportionately affecting vulnerable countries. The discussions also highlighted the difficult trade-offs countries face as they balance short-term energy security with long-term structural reforms for the transition to cleaner energy. Ensuring availability and accessibility of critical minerals to facilitate smoother transition as well as generating domestic savings to meet investment needs and thus boosting economic growth for the transition were also issues that came up for discussion.
The two-day FWG meeting, which was concluded in Chennai on March 25, was co-chaired by V Anantha Nageswaran, chief economic adviser of India and Clare Lombardelli, chief economic adviser, UK Treasury. Around 87 delegates from G20 member countries, invitees, and international organisations attended the meeting.
The group’s deliberations focused on global macroeconomic issues and deliberated on how policy cooperation can be enhanced to achieve strong, sustainable, balanced, and inclusive growth (SSBIG). The agenda for the meeting involved discussions on the global economic outlook and risks with a particular emphasis placed on inflation, macroeconomic implications of food and energy insecurity, climate change, and transition policies.
During the discussion, members discussed and agreed on the way forward for important deliverables for the year, including those on macroeconomic consequences of food and energy insecurity and climate changes and transition pathways. In addition, several international organisations, including WBG, IMF, FAO, IEA, NGFS and OECD, made detailed technical presentations on these issues to inform the FWG outcomes.
On the sidelines of the FWG meeting, a panel discussion on the macroeconomic impacts of climate change and transition pathways was also organised in collaboration with UAE who will be the presidency of COP28. The session aimed to develop a collective understanding of the challenges facing countries during the climate transition and initiate a discussion on the macroeconomics around climate policy action and transition pathways. An outreach programme with IIT Madras and Madras School of Economics was also held in the run-up to the meeting. The chief economic adviser interacted with students and researchers on India and the world economy, mainly focusing on India’s 2023 G20 presidency.
The Reserve Bank of India