G20 New Delhi Summit: How India sought to achieve harmonious consensus in global society with diverse interests

Navigating consensus in multilateral forums has always been an intricate dance of diplomacy, particularly in an era overshadowed by the Ukraine-Russia conflict. The tensions and divergent interests that the conflict epitomises amplify the inherent challenges of building unity amidst global diversity. Philosopher Isaiah Berlin, in his seminal work on the plurality of values, alluded to the inescapable conflict between competing objectives and ideals. Similarly, scholar Hedley Bull emphasized the “ anarchical society” of international relations, where states, despite being intertwined in a web of interdependence, grapple with their own priorities and apprehensions. Yet, it is against this intricate backdrop that the consensus reached in the New Delhi Declaration becomes all the more significant. India, in a testament to its emerging leadership and diplomatic finesse, has managed to bring disparate nations onto a shared page, demonstrating that even amidst global uncertainties, the art of consensus-building remains alive and potent. In recent years, India has ascended as a credible and influential voice for the Global South, positioning itself as a responsible stakeholder in the realm of international diplomacy. Unlike certain nations that have entangled low and middle-income countries in debt traps, often undermining their sovereignty and economic independence, India has charted a different course. The inclusion of the African Union in the G20 as a permanent member, a landmark move initiated at India’s behest, stands as a seminal example of this leadership. Earlier this year, the Prime Minister of India organised the Voices of the Global South Summit, thereby providing a significant platform for marginalised nations to articulate their concerns and aspirations on the global stage. By facilitating the African Union’s inclusion in the G20, India has not merely voiced concerns about the Global South but has taken a transformative step towards its empowerment. This advocacy and actionable change underline India’s commitment to a more inclusive and equitable international order. As such, India’s efforts further validate the notion that it serves as a dynamic force for unity and cooperative global governance. Against this backdrop, India’s G20 presidency has also pushed for multilateral development banks (MDB) reforms. This started with India setting up an Independent Expert Group on Strengthening MDBs which was headed by Lawrence Summers and N K Singh. The group has already turned in the first of two volumes of its recommendations, titled “ The Triple Agenda.” The current state of global challenges, ranging from extreme poverty to climate change, demands a radical reformation and strengthening of MDBs. The Sustainable Development Goals (SDGs) are falling behind, with over 600 million people still in extreme poverty and urgent issues like climate change not being adequately addressed. MDBs, which have a wealth of knowledge and are capable of providing low-cost, long-maturity financing, are well-positioned to support needed reforms and resources. They can create the conditions for transformative growth by working with governments and the private sector. Yet, they themselves need to undergo transformations to meet these immense challenges. Thus, the expert group has proposed a “triple agenda” for MDBs: adopting a mandate that includes poverty elimination, shared prosperity, and contributing to global public goods; tripling sustainable lending by 2030; and creating a new funding mechanism for engaging with willing investors. However, achieving these ambitious goals will require significant changes in how MDBs operate. They need to integrate development and climate agendas effectively, become more client-responsive, take more risks, and streamline their project timelines. MDBs have to mobilise more private capital, aiming to double the current rate of 0.6 dollars for every dollar they lend. Additionally, the report emphasises the need for a new legal and institutional mechanism to attract more investors and recommends a General Capital Increase for those MDBs with headroom constraints. Importantly, the report states that MDBs should work cohesively as a system, harmonising their various operational standards and sharing diagnostic tools. For these reforms to succeed, sustained multi-year efforts and independent oversight are essential. There is a need for an independent monitoring group to report on the progress and ensure the recommendations are implemented effectively across multiple presidencies. The Indian G20 presidency also took forward the work of the Italian G20 presidency on Capital Adequacy Framework. India’s G20 Presidency came up with the “G20 Roadmap for the Implementation of the Recommendations of the G20 Independent Review of Multilateral Development Banks’ Capital Adequacy Frameworks.” [Refer] The Roadmap serves as a strategic blueprint for the implementation of the CAF (Common Assessment Framework) recommendations across MDBs. Offering a clear snapshot of progress, it outlines both successful adaptations, such as risk appetite redefinitions and collaboration on the GEMS 2.0 initiative, as well as areas requiring further action, like the utilisation of callable capital and the exploration of hybrid capital options. It provides actionable forward-looking guidance from the G20 on topics ranging from capital adequacy metrics to interactions with Credit Rating Agencies. The Roadmap also fosters cross-institutional collaboration and encourages MDBs to engage in regular reviews and refinements of their strategies. It represents an evolving tool designed to maximise the lending capacity and operational efficiency of MDBs while ensuring alignment with international best practices. These reforms of MDBs would benefit the global south the most. The G20’s New Delhi Declaration re-emphasises its commitment to a robust, quota-based, and sufficiently funded International Monetary Fund (IMF) as a linchpin of the global financial system. It underscores the importance of continuing with IMF governance reforms, especially under the 16th General Review of Quotas, with a completion target of 15 December 2023. This process aims not only to revise the quota formula but also to confirm the centrality of quotas in IMF’s financial resources. Concurrently, the G20 celebrates the raising of $100 billion in voluntary contributions and $2.6 billion in grants, urging swift delivery of these pledges to benefit countries in dire need. It also applauds advancements in specific trust initiatives like the Resilience and Sustainability Trust (RST) and the Poverty Reduction and Growth Trust (PRGT), and calls for further voluntary support to make these programs more effective and sustainable. The declaration showcases G20’s ongoing commitment to Africa and explores the possibility of channelling Special Drawing Rights (SDRs) through MDBs, while maintaining their reserve asset status. Overall, the declaration is a comprehensive affirmation of G20’s commitment to fortifying the IMF and addressing financial inequities globally. India’s G20 presidency, under the backdrop of the New Delhi Declaration, is a poignant testament to the nation’s steadfast commitment to raising the voices of the Global South on the world stage. Drawing parallels from the cinematic world, it is reminiscent of the epic journey of Frodo in “The Lord of the Rings,” where he strives against all odds to champion a larger cause, illustrating that even the smallest entity can have an indomitable spirit and profound impact. In the same vein, India’s leadership successfully put forth the concerns of nations that often remain marginalised in global discourse. India’s endeavours resonate with the idea that, even in a global society with diverse interests, finding a harmonious consensus is achievable. Through its presidency, India has not only tabled the pressing issues of the Global South but also catalysed actionable change, redefining global diplomacy’s narrative. This commitment is a living embodiment of the phrase “actions speak louder than words”, proving that true leadership is not just about voicing concerns but championing them towards tangible outcomes. The author is OSD, Research, Economic Advisory Council to the Prime Minister. He tweets @adityasinha004. Views expressed in the above piece are personal and solely that of the author. They do not necessarily reflect Firstpost_’s views._   Read all the  Latest News,  Trending News,  Cricket News,  Bollywood News, India News and  Entertainment News here. Follow us on  Facebook,  Twitter and  Instagram.