India’s Diplomatic Coup at G-20 Summit

Introduction

India assumed the Presidency of the G-20 from Indonesia in Bali in 2022 from 1 December and retains the Presidency for the year 2023 till 30 November. India hosted the G-20 summit from 9 to 10 in the capital city of New Delhi. Prime Minister Narendra Modi pulled off a massive victory when an unexpected breakthrough was reached, thanks to the assiduous diplomatic skills of the officials who laboured hard to finalise the section on geopolitics, which helped forge consensus on a new language on the contentious Russia-Ukraine war.

The members delivered the New Delhi Leaders’ Declaration carving out a consensus and marked a moment that will go down in history as arguably India’s greatest foreign policy accomplishment in a global forum. The final document marked a shift in the position taken by the US, the EU and G-7 countries, thereby diluting the harsh criticism of Russia contained in the 2022 Bali G-20 statement. The final breakthrough followed a proposal by Indonesia, India, Brazil and South Africa, that was negotiated by diplomats and officials until past midnight of 7 September and again the next day. The development was announced directly by PM Modi. Japan as current President of the G-7 plus EU bloc also played a role in bridging the differences.

What are the Key Takeaways?

The G-20 summits are held every year rotating among the members. But it is rare that a single presidency could deliver a Declaration that has the potential to alter and shape the trajectory of global development in its multiple dimensions. The final consensus Declaration contained 83 paragraphs, including eight paragraphs on the Ukraine war and its resultant economic impact. Seven key takeaways could be identified that would reverberate in the coming years.

First: On the financial track, the Declaration contained agreement that aims to strengthen multilateral development bank, a way forward for regulating crypto currencies and the use of digital public infrastructure for financial inclusion as major gains, along with a faster debt distress plan for vulnerable countries. By accepting a G-20 framework for DPI systems, welcoming India’s quest to build a Global DPI repository and noting its efforts to set up the One Future Alliance, the Declaration gave the world a new template and India a global role in an area where it is far ahead of almost every other country.

Second: on Climate Change, the Declaration included a “quantum jump” in climate financing from billions of dollars to trillions of dollars, noting the need for $5.8-5.9 trillion in the pre-2030 period for developing countries as well as $4 trillion per year for clean energy technologies by 2030 to reach net zero by 2050. The G-20 nations also resolved to increase women’s participation and leadership in climate change mitigation and adaptation and support gender-responsive solutions to build resilience to its impact.

Third: Crypto. The Declaration reaffirmed commitment to zero tolerance for corruption. It contained provisions to support global efforts to seize, confiscate and return criminal proceeds to victims and states, in line with international obligations and domestic legal frameworks, including through support to the Financial Action Task Force and operationalisation of the GlobE Network.

Fourth: Multilateral Development Bank. The Declaration called for reform of the multilateral development bank such as the World Bank. This was set up after World War II and there are limitations to its activities as poverty has increased worldwide, and the WB’s role needs to be revamped so that it contributes to global public good. The Declaration set up a roadmap for additional resource mobilisation through a variety of mechanisms. These included additional funding from shareholders, balance sheet optimisation and private finance involvement. If implemented, the Declaration hoped, this will reshape the architecture of global development.

Fifth: Artificial Intelligence. India took the initiative to bring the issue of artificial intelligence to the table and got the members agree on the principles of ‘protection of human rights, transparency and explainability, fairness, accountability, regulation, safety, appropriate human oversight, ethics, biases, privacy, and data protection, for the development and deployment of AI.

Sixth: Disaster Risk Reduction. The Indian Presidency institutionalised the Disaster Risk Reduction (DRR) Working Group. The Declaration asked for progress on early warning and action by strengthening national capacity and finances. It welcomed the Global Platform for DRR and reiterated commitment to the Sendai Framework. It noted that in an uncertain world, the only certainty is that disaster will increase. India thus put the issue on the global agenda.

Seventh: Immediate Challenges. The Declaration addressed two immediate challenges with medium-term implications. On the Ukraine crisis, it provided a roadmap of how the great geopolitical divide of our time can be prevented from crippling global cooperation. On debt, by pushing forward the management of debt crises in four nations – Sri Lanka, Zambia, Ghana and Ethiopia – India provided a roadmap for other such cases.

As the world leaders watched India’s G-20 Presidency, the adoption of the Delhi Declaration was a triumph for India’s diplomacy and foreign policy. India’s slogan of “One Earth, One Family, One Family” was thus endorsed by the world leaders. Though Chinese President chose to stay away from the summit, China finally backed the Declaration and reaffirmed its recent calls for the grouping to stay away from “geopolitics”.

Inclusion of the AU

When PM Modi announced the G-20’s decision to include the 55-nation African Union as permanent member, the second regional bloc to join the G-20 after the European Union, it was yet another feather in India’s diplomatic cap. It was the first expansion of the bloc since it was created in 1999 to cope with a series of financial crises.

The AU will have the same status as the 27-member EU, the only regional bloc so far with full membership of the G-20. Pushing the case of the AU into the bloc was consistent with India’s Presidency to put the concerns and interests of the Global South at the centre of its agenda for the summit. After PM Modi obtained the agreement of the existing members and banged the gavel thrice to mark the entry of the AU into the grouping and invited the current AU Chairperson, Comoros President Azali Assoumani, to take his table as a permanent member, it was an emotional moment for Assoumani.

India had already done the groundwork by backchannel diplomacy and written in June to its counterparts of the bloc proposing AU’s full membership during the summit. The proposal was backed by key members of the EU, China and Russia, albeit for different reasons. India had also secured Japan’s support. Japan’s Prime Minister Fumio Kishida was convinced that the AU as a part of the Global South deserves a greater say in the global governance architecture.

China was seen as reluctant to go against the move in view of its large investments in Africa through the Belt and Road Initiative. Russia too was keen to be seen to be in friendly terms with the African nations as a move to counter its isolation by the West over the Ukraine conflict. The South African President Cyril Ramaphosa too was upbeat when he remarked that the inclusion of the AU into the G-20 family will help cement partnerships that prioritise all-round development, leading to a better planet.

The inclusion of the AU shall add to the clout to the 55-member continental group, which is home to some of the fastest growing economies in the world with a combined GDP of $2.4 trillion and accounting for about 85 per cent of global GDP, more than 75 per cent of global trade and about two-thirds of the world population is a remarkable thing that cannot be overlooked.

While G-20 now stands legitimately empowered to decide on issues relating to economic and financial developments, the expanded bloc shall now speak for 80 per cent of the world population rather than just 65 per cent. Prior to the AU’s inclusion, Europe with a population of 448 million was represented by four states (France, Germany, the UK, Italy and the EU), while Africa, a continent of 1.4 billion people had a lone representative in South Africa. This historical wrong has now been corrected by embracing the AU into the G-20 fold. Much of the credit goes to India’s expertise in diplomatic skills.

The Times of India remarked in an editorial on 11 September 2023 that AU’s inclusion as a permanent G-20 member has big geopolitical ramifications. Africa seems destined to be the next global growth hub. As a resource-rich continent with 1.4 billion people and a youthful demographic, Africa has been keen to play a more significant role in international affairs. For example, its massive reservoir of natural resources shall play an important role for world economic growth. Morocco, that experienced a devastating earthquake when the summit was in progress, has the largest phosphate reserves in the world. DR Congo is endowed with huge deposits of cobalt. Nigerian gas can power all of Europe. With so much resource endowment, Africa had very little say at the global high table. The inclusion of the AU to the G-20 fold shall address this to some extent.

As regards India, PM Modi’s statesmanship role to facilitate AU’s inclusion is the best thing to happen during India’s Presidency at the summit. India can be seen as a viable alternative development partner by AU, which has so far been looking at China with its developmental projects most of which are opaque with many hidden clauses detrimental to the interests of the African nations.

In the defence domain, India can be an important player for cooperation too. India and Africa already conducted the first-ever joint army chiefs’ conclave in 2023. India is also a potential defence supplier to Africa. For example, Seychelles, Mauritius and Mozambique already rank as the top three Made-in-India arms importers between 2017 and 2022. India has also partnered with some of the African nations in the fields of healthcare, education, and solar power generation. With AU’s inclusion, both sides are likely to fast-track in finalising dates of the much-delayed fourth India-Africa Forum Summit. The African nations shall find more rewarding in partnering with India in developmental projects rather than getting entangled in projects with China’s involvement as most are opaque and with hidden clauses, detrimental to their interests. The economic dividends for both India and Africa could be huge.

Modi’s Discussions on the Sidelines

PM used this opportunity to hold bilateral meetings with some of the world leaders, during which some agreements were reached while roadmaps were agreed upon on others. Recognising the delay in concluding the negotiations for a Free Trade Agreement, PM Modi had a productive conversation with his British counterpart Rishi Sunak. In the bilateral with Japanese Prime Minister Fumio Kishida, Kishida called for cooperation in improving the investment environment in India to achieve a 5 trillion yen target of public and private investment and financing from Japan to India in the next five years. The target was set in March 2022. Both welcomed the provision of a 400 billion yen loan for the construction project of the high speed rail, a flagship project of Japan and India which is underway.

With France, PM Modi and French President Emmanuel Marcon called for early finalisation of the Defence Industrial Roadmap to facilitate design and manufacturing of advanced defence technologies and expand cooperation in not only in India but also other Indo-Pacific countries. France is one of India’s most trusted defence partners that see itself as a pioneer in transfer of technology to India. The two countries look at each other as indispensable partners in the Indo-Pacific where France is a resident power. PM Modi also had substantial talks with the US President Joe Biden on key issues. Both gave nod to joint $1 billion fund for renewable energy infra in India. PM Modi also had a bilateral meeting at the margin with the Turkiye President Recep Erdogan, the second times after their meeting on the sidelines of the SCO summit in Samarkand in 2022. On the sidelines, India launched the Global Biofuels Alliance. PM Modi urged the G-20 nations to join the initiative with a plea to take blending of ethanol with patrol to 20 per cent to 20 per cent globally.

The Issue of UNSC Membership

India has been consistent in its argument that reforms are needed for the United Nations reflecting the changing realities of the contemporary world. As the most populous nation in the world, India has a legitimate claim to be a permanent member of the United Nations Security Council. India’s aspirations found resonance in many capitals because of its rising geopolitical stock as evidenced by its success in pulling off a consensus declaration at the G-20 meeting. Except China, the rest four of the veto-armed countries – the US, UK, France and Russia – support India’s legitimate claim to be a permanent member of the UNSC. China has made no secret of its determination to keep India pegged as a South Asian power and has blocked India’s entry even into the Nuclear Suppliers’ Group to persist with its obstruction.

Backing India’s permanent membership to the UNSC, Turkiye President Erdogan said the world is bigger and not restricted only to its five permanent members. At present the UNSC has five permanent members and 10 non-permanent members. Erdogan further proposed all 15 should be permanent members and all the rest in the 195 members should be permanent members on rotational basis. This was a radical suggestion that can have few supporters.

While the case of India becoming a permanent member of the UNSC remains undisputed and has universal endorsement sans China, the path to realise this is full of pebbles. The issue of UNSC reforms has been on the table for decades. The last time the Council was expanded was in 1965 to increase the number of non-permanent rotational members to 10. But the veto-wielding, permanent members have remained the same since 1945. While the People’s Republic of China replaced Republic of China, Russia took over the erstwhile Soviet Union’s seat.

The process of UNSC reform is complicated. The UN Charters mandates that any amendment has to pass through two-third of the UN members in a vote and further accompanied by ratification by the same number. The catch is, this process must include all the five UNSC permanent members. It is here China has been playing the spoiler. Given the state of India-China ties today, Beijing is unlikely to support India’s case in the foreseeable future. Yet, efforts to reform the UNSC reflecting the present geopolitics realities must not be abandoned.

Ukraine Issue

On the issue of Ukraine war, though the Declaration carefully drafted to strike a balance and did not mention Russia directly, Ukraine was not too pleased. Keeping the spirit of compromise in mind while finalising the draft, it focussed on the social consequences of the war rather than any effort to hold Russia accountable for its actions. By this compromise deal, it emerged to be different than the Bali Declaration which had condemned the Russian aggression against Ukraine, and avoided any mention of Russia, except in the context of efforts to revive the Black Sea Grain Initiative that the latter had been abandoned. Understandably, Ukraine was not too pleased and reacted that there was nothing in the Declaration to be proud of. Viewed holistically, the G-20 summit under India’s Presidency was a diplomatic victory, thereby elevating India’s global profile.

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