Prof D Mukherjee
The 50th G-7 Summit, held in Italy from June 13 to 15, 2024, marked a significant milestone in international diplomacy, bringing together the world’s most advanced economies to address pressing global challenges. The first G-7 Summit took place in Rambouillet, France, during November 15 to 17, 1975. Initially known as the G-6, it brought together leaders from six of the world’s major industrialized democracies viz. France, Germany, Italy, Japan, the United Kingdom, and the United States. The summit was convened in response to the economic turmoil of the early 1970s, marked by the oil crisis and the collapse of the Bretton Woods monetary system. Key Resolutions of the First G-7 Summit were economic cooperation, energy security with an emphasis to having collective strategies to ensure stable energy supplies and reduce dependence on oil imports from the Middle East, trade liberalization by recognizing the importance of open markets and monetary stability with the collapse of the fixed exchange rate system and architecting mechanisms for better coordination of monetary policies to stabilize exchange rates and prevent competitive devaluations and economic policy coordination by initiating a framework for ongoing economic policy coordination among the member countries. This included regular consultations and information sharing to align their economic policies and respond collectively to global economic challenges. Under the backdrop of the resolutions of the first G-7 Summit, subsequent G-7 Summits are being regularly held annually since 1975.
The 50th G-7 Summit saw participation from the United States, Canada, European Union, France, Germany, Italy, Japan, the United Kingdom United States of America and a host of special Invitees including Brazil, India, Argentina, Turkey, UAE and international organizations. This year’s summit focused on several key themes: economic resilience, climate change, global health, and geopolitical stability. India was represented by Narendra D. Modi, Prime Minister of India. Prime Minister Narendra Modi’s participation in the outreach of the 50th G-7 Summit underscores India’s growing influence on the global stage and her commitment to addressing global challenges collaboratively. His presence at the summit highlights India’s strategic importance as a partner in discussions on economic resilience, climate change, and global health. PM Modi’s engagement with G-7 leaders is expected to facilitate stronger bilateral and multilateral ties, opening avenues for increased collaboration and investment. India’s proactive stance on sustainable development and technological innovation aligns well with the G-7’s objectives, positioning the country as a key player in the global efforts to build a resilient and sustainable future. PM Modi’s interactions with G-7 leaders can lead to enhanced cooperation in areas such as renewable energy, digital infrastructure, and health security. This collaboration can attract investments and technological expertise to India, accelerating its development goals. Additionally, India’s participation in discussions on global health and pandemic preparedness can bolster its healthcare infrastructure, ensuring better preparedness for future health crises. Linking sustainable FDI with the global supply chain can provide significant benefits to India, enhancing its economic growth and environmental sustainability. Indian leadership is likely to further solidify India’s role in the global arena, fostering stronger international partnerships and driving progress on key global issues such as economic resilience. A primary focus of the summit was enhancing economic resilience amidst ongoing uncertainties in the global economy. This summit prioritized strategies to mitigate the impact of inflation, supply chain disruptions, and potential recessionary trends besides attaching commitment to implement and promote the ‘India-Middle East Europe Economic Corridor (IMEEEC). Besides, G7 also took into cognizance the priority of the Lobito Corridor in Central Africa and Luzon Corridor and the Middle East Corridor. It is worth mentioning that IMEEEC shall act as a cord between the Indian West Coastal Ports and UAE wherefrom cargos shall be shipped by rail to Europe and an easy access shall be extended to African countries. G7 also initiated discussions on a coordinated approach to regulate digital currencies and enhance cybersecurity frameworks to protect global financial systems. Impact of climate change and protecting biodiversity, highlighting global health security and the need for greater investment in healthcare infrastructure and research to combat infectious diseases such as Covid-19. Geopolitical Stability is of prime concern.
India stands to gain significantly by linking sustainable Foreign Direct Investment (FDI) with the global supply chain, as such the focus on sustainable development and economic resilience is likely to present India with an opportunity to attract FDI that aligns with its green and inclusive growth objectives. By integrating sustainable FDI into her economic framework, India can enhance magnitude of her participation in the global supply chain. This approach would attract investments in renewable energy, green technologies, and sustainable agriculture, fostering innovation and creating employments. Moreover, sustainable FDI can help India modernize its infrastructure, reduce carbon emissions, and achieve its climate goals, contributing to global environmental efforts. Furthermore, aligning with global supply chain standards will improve India’s export competitiveness. Sustainable practices can enhance the quality and sustainability of Indian products, making them more attractive to international markets that prioritize eco-friendly and socially responsible goods. This can lead to increased market access and stronger trade relationships.
The summit reflects concerns over China’s growing economic and geopolitical influence, particularly in trade, technology, and global supply chains. Strategies to counterbalance China’s dominance are crucial for empowering countries like Indonesia, Cambodia, Laos, Vietnam, and India. Karl P. Sauvant, Senior Fellow at the Columbia Centre on Sustainable Investment and a Professor of Law at Columbia University, emphasized the importance of this issue in his research, promoting a balanced global economic landscape.
By encouraging investments and diversifying supply chains away from China, the G-7 can help these Southeast Asian countries and India build more resilient and competitive economies. Reducing dependency on China offers opportunities for these nations to attract Foreign Direct Investment (FDI), spurring economic growth, job creation, and technological advancement. Diversifying supply chains can increase production and export opportunities, enhancing industrial capabilities and reducing vulnerabilities to global disruptions. Technology transfer and innovation promotion can boost these countries’ competitiveness in high-tech industries and support sustainable development. Enhanced economic ties with G-7 nations can also provide geopolitical stability. As these countries integrate into the global economy, they can negotiate better trade deals and secure their national interests. The China issue at the G-7 Summit aims to address economic and geopolitical imbalances while empowering other nations for sustainable growth. Leveraging G-7 strategies, these countries can enhance their economic resilience, technological capabilities, and geopolitical stability, contributing to a balanced and sustainable global economy.
The G-7, comprising some of the world’s largest advanced economies, plays a crucial role in global economic policies and addressing international challenges. However, expanding the G-7 to include major and emerging economies such as India, Brazil, the UAE, and South Korea would enhance its relevance, legitimacy, and effectiveness. This expansion would reflect the current global economic realities, as these emerging economies are now key players in global trade, investment, and innovation. Including them would ensure the G-7 better represents the world’s economic powerhouses and foster greater economic and geopolitical stability through diverse perspectives. Emerging economies bring unique insights into global issues like trade policies, climate change, and sustainable development, leading to more balanced policy solutions. This inclusivity would address criticisms of the G-7 being an exclusive club of wealthy nations and promote inclusive global governance. Furthermore, the COVID-19 pandemic highlighted the need for coordinated action across both advanced and emerging economies. Including countries like South Korea, a model in pandemic management, would enhance the G-7’s collective response to global health crises and economic recovery strategies. Regional leaders like the UAE, South Korea and others could also promote regional stability and cooperation. An expanded G-7 would be better equipped to lead international efforts toward a stable, sustainable, and prosperous future.
(The author is a Bangalore based Educationist and Management Scientist)
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