As India prepares to host the 18th edition of the G20 Leaders’ Summit in New Delhi in early September, the pomp and show on the streets – wall graffiti, banners, manicured walkways, and hoardings with the self-congratulatory ‘Mother of Democracy’ catchphrase supported by images of the Indian Prime Minister—mostly leaves the common spectator bewildered. One wonders what is the point of this extravaganza at a time when the country is facing the wrath of climate change in the form of heat waves and flash floods, rise in food prices, and backsliding of democratic institutions and spaces. It is therefore a perfect time to ask: What is the G20, what is its history and politics, and what role has it played in the recent past?
The G20: Emergence and Evolution
The G20 is an intergovernmental forum of 19 countries and the European Union (EU) that calls itself “a premier forum for international economic cooperation.” Formed in 1999 after the Asian financial crisis as a self-appointed extra-institutional platform of the Finance Ministers and Central Bank Governors (FMCBGs) of the world’s most advanced and emerging ‘market economies’, the G20 deliberated on macroeconomic issues to ensure financial stability. Its stated goals were “to provide a new mechanism for informal dialogue in the framework of the Bretton Woods institutional system, to broaden the discussions on key economic and financial policy issues among systemically significant economies and promote cooperation to achieve stable and sustainable world economic growth that benefits all.” In other words, the G20 was essentially conceived as an extension of the G7 by onboarding carefully chosen countries from the global South who, since its inception, endorsed the authority of the IMF and the World Bank Group, the international financial institutions (IFIs) controlled by the rich countries of the global North.
Towards the end of 2004, a UN High-Level Panel on Threats, Challenges and Change submitted a report to the UN Secretary General recommending: (a) the elevation of the G20 from FMCBGs to the leaders’ level, and (b) entrusting the G20 with the task of “addressing the critical inter-linkages between trade, finance, the environment, the handling of pandemic diseases and economic and social development.” In 2008, the world encountered an unparalleled financial crisis. While the worst-affected countries during this crisis were the US, UK and other European powers, the recession also demonstrated, as C.P. Chandrasekhar noted, the “global imbalances that partly resulted from the effort of the developing countries to insure themselves against a 1997-type affliction or a post-1997-type correction.” In response to this US-propelled global financial crisis, the G20 was promptly elevated to the level of heads of states after the collapse of the Lehman Brothers. The G7 countries realised that attempting a recovery and avoiding another calamity would not be possible without the involvement of countries such as China, India and Brazil who had started to assume prominence on the global economic landscape. Thus, a summit of the G20 leaders was hurriedly organised in Washington D.C., the citadel of capitalism, on 14-15 November 2008 to come up with a plan for economic recovery and prevent the meltdown through coordinated action. Since then, the G20 has held seventeen annual summits till 2022.
Read the full paper here: A brief history of the G20