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Bali tidings

As the G-20 presidency passes to India, all eyes will be on how it makes it relevant to address global challenges

Bali tidings
In this regard, the declaration states that G-20 central banks will calibrate monetary tightening while being mindful of the need to limit cross-country spillovers. (Reuters image)

Russia’s invasion of Ukraine cast a long shadow over the Group of 20’s (G-20) summit in Bali, threatening to render the grouping dysfunctional. Much as the Western members led by the US wished to condemn the ongoing war in the strongest possible terms—including earlier efforts to ban or boycott the participation of Russia in the G-20—there were dissensions among members of this broad-based grouping, that includes emerging economies, to tone it down. The fact that Western leaders agreed to come to Bali even if the Russian president Vladimir Putin or his foreign minister Sergey Lavrov attended is largely due to the efforts of Indonesia, which helmed the G-20 during the last year. India will take charge from December. The fact that there was a consensus-driven G-20 Bali leaders’ declaration is also a considerable achievement as earlier meetings of the G-20 finance, foreign and climate ministers this year failed in this regard. India played an influential behind-the-scenes role in securing consensus among the G-20 over the wording of this declaration that reflected what prime minister Narendra Modi told Putin on the sidelines of the Shanghai Cooperation Organization summit in Samarkand. “The peaceful resolution of conflicts, efforts to address crises, as well as diplomacy and dialogue, are vital. Today’s era must not be of war”, stated the declaration, vindicating India’s stand on this conflict.

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While the Western nations, especially European, view the Russian invasion of Ukraine as an existential threat upon their borders, the global South has been devastated by its fallout. At a time the world economy is buffeted by headwinds due to the Covid pandemic and climate change, the conflict in Ukraine has adversely impacted the energy and food security of developing nations. Fortunately, the G-20 summit deliberations were not derailed due to the politicisation of such important matters, notwithstanding sharp differences among members. The declaration undertakes to “take action to promote food and energy security and support stability of markets providing temporary and targeted support to cushion the impact of price increases”. For the poorer countries, more funds are needed to cope with the ravages of climate change. The declaration urges developed countries to make good on their promise of providing $100 billion annually in climate finance. Another key concern is that developed countries like the US are raising interest rates to combat inflation, triggering large and volatile capital flows, besides strengthening the dollar, which affect the trade and current account balances of poorer countries, many of which are debt-ridden. In this regard, the declaration states that G-20 central banks will calibrate monetary tightening while being mindful of the need to limit cross-country spillovers.

As the G-20 presidency passes to India, all eyes will be on how it makes this influential grouping relevant to address global challenges, including negotiating an end to the nine-month-long war in Ukraine through diplomacy and dialogue. The G-20 has seen better days, when it played an influential role in steering the world economy out of the economic crisis of 2008-2010, but has failed to provide leadership in the fight against the Covid pandemic. But Modi, in his remarks at the closing session of the G-20 summit, stated India will strive to ensure that the grouping acts as a prime mover to envisage new ideas and accelerate collective action, that India’s G-20 presidency will be inclusive, ambitious, decisive and action-oriented.

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First published on: 17-11-2022 at 04:15 IST