Why was the G20 necessary? How does this international group work?

Why was the G20 necessary? How does this international group work?

The G20 summit will be held in New Delhi on September 9-10. This is the first time that such a large-scale international conference is going to be held in India. Although the presidents of Russia and China are not coming, many prominent people including US President Joe Biden, British Prime Minister Rishi Sunak, South Korean President Yun Suk Yeol, Canadian Prime Minister Justin Trudeau are coming.

Almost ready for this is the newly inaugurated International Exhibition and Conference Centre, Bharat Mandapam at the Pragati Maidan complex. Let's find out why this group of 20 countries was created, how does this group work?

Reasons for the formation of the G20 group

Currently, these countries account for about 85 percent of the world's GDP, more than 75 percent of world trade, and more than 60 percent of the world's population. After the East Asian financial crisis in 1997, the group was established to deal with that crisis. A meeting of finance ministers and central bank governors of the G7 group of Canada, France, Germany, Italy, Japan, Britain and the United States was held in June 1999. In that meeting it was decided that several more countries should be included in the international discussion and coordination of economic matters. The G20 was established in September of that year to achieve that goal.

For the first few years, only the finance ministers of the G20 countries and the central bank governors of the countries met annually. However, after the global financial crisis in 2008, the forum was elevated to the level of a meeting between heads of state. That is, the meeting between the heads of state of the G20 group begins. And finance ministers started meeting twice a year. The first G20 summit was held in November 2008, in Washington DC, the capital of America. The focus of the conference was financial stability in the international arena. Over the past few years, the forum has discussed global trade, the energy crisis, climate change, terrorism, as well as Russia's invasion of Ukraine.

How does the G20 work?

The G20 basically works in two ways. The first is the economic pathway, which focuses on financial and economic issues. The second is the Sherpa Trail. Various issues are discussed between the 'Sherpas', i.e. the diplomatic representatives of the member countries. Each pathway consists of specific thematic working groups. It consists of relevant ministries of member countries and representatives of invited/guest countries. Besides, representatives of various international organizations like United Nations, International Monetary Fund, Organization for Economic Co-operation and Development are also part of the working group.

The economic path is led by the finance ministers of the member countries and central bank governors. Global economic risks, international taxation, reforms to build a resilient financial infrastructure and many other economic issues are discussed along the way. Its working groups include the Framework Working Group, the International Financial Architecture Working Group, the Joint Finance and Health Task Force and the Global Partnership for Financial Inclusion.

Topics like agriculture, culture, digital economy, education, energy and tourism are discussed on the Sherpa Path. Sherpas also discuss the summit agenda throughout the year. There are several other working groups like Business20, Think20, Women20 to ensure the participation of non-governmental organizations from G20 member countries. These groups contribute to policy making on various issues.

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