Rising global debt to be in focus as G20 conclave kicks off in Chandigarh today

Leading economies of the world will discuss the global debt situation and explore solutions to better handle the mounting debt as the first of the two G20 Summit meetings planned in Chandigarh gets underway on Monday.

How to strengthen multilateral banks and international financial institutions, how to gain financial resilience through sustainable capital and managing global debt vulnerabilities are some of the hot-button issues that will come up at the first meeting of the International Financial Architecture Working Group, scheduled at Hotel Lalit on Monday and Tuesday.

Established in 1999 in response to several world economic crises, the G20 comprises Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, the Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the UK, the US and the European Union.

Comprising the world’s major developed and developing countries, G20 accounts for 80% of the global GDP, 75% of international trade and two-thirds of the world population, making it a premier forum for international economic cooperation.

The G20 Summit is held annually under a rotating presidency that this year rests with India, whose theme is “One Earth, One Family, One Future”.

The conclave in Chandigarh will be inaugurated by Union minister of agriculture and farmers welfare Narendra Singh Tomar on Monday morning.

The discussions will be jointly steered by the Union ministry of finance and the Reserve Bank of India (RBI), along with France and South Korea, who are co-chairs of the International Financial Architecture Working Group.

“Debt is a major item on the agenda...under the Indian presidency, there will be a comprehensive look at the global debt situation. The idea is to come out with a report to see what has worked and what has not, and how it can be improved,” said Anu P Mathai, adviser in the Union finance ministry, pointing out that the International Financial Architecture Working Group, as the name suggested, particularly dealt with strengthening crisis response, especially in very poor nations.

In 2020, under the debt service suspension initiative, steps were taken to defer the debt repayment of very poor countries. Next step was how to restructure debt of very poor countries and equally important was transparency of debt.

According to Mathai, now under Indian presidency, the focus will be on how to handle debt in a better way, as certain initiatives taken earlier did not yield the desired results.

Yet another issue to be discussed, she said, was how to make multilateral development banks stronger to meet financing requirements. How global financial safety net can be made stronger is another key issue on the agenda.

The G20 initially focused largely on broad macroeconomic issues, but it has since expanded its agenda to include, inter-alia, trade, climate change, sustainable development, health, agriculture, energy, environment, climate change and anti-corruption.

Delegates enjoy glimpses of Chandigarh

Around 100 delegates from 50 nations, including representatives of G20 countries, guest countries and international organisations, will be participating in the two-day meeting in Chandigarh.

On Sunday, brushing aside the chill, around 70 delegates stepped out to explore Chandigarh.

They visited Le Corbusier Centre in Sector 19, Rock Garden and Capitol Complex in Sector 1, where they toured Punjab and Haryana assembly; Punjab and Haryana high court and got a wide view of the City Beautiful from the roof of the Punjab secretariat.

Some of them also visited the house of city’s first chief architect Pierre Jeanneret in Sector 5.

In the evening, they watched an exhibition polo match at the Indian Reserve Battalion ground at Sarangpur. The match was organised by the Polo Club in association with the Chandigarh Police.

Baldeo Purushartha, joint secretary, Union finance ministry, said in the run-up to the two-day meeting, a number of events were held across Chandigarh for increasing public participation and generating interest in the G20 events under Indian presidency.

Following the discussions in Chandigarh, the first meeting of the G20 finance ministers and central bank governors will be held in Bengaluru on February 24-25. The G20 Summit will return to Chandigarh in March for another meeting on agriculture issues.

(With inputs from Hillary Victor)