Build Back Better
Collaborate for better global infrastructure
The annual G7 summit this June had leaders from USA, UK, France, Germany, Italy, Japan and Canada in attendance. South Korea, India and Australia were special virtual attendees. Cumulatively the countries represented more than half the GDP of the world economy.
Covid-19 – Pandemic and Vaccination
This was one of the key highlights of the discussion-equitable distribution of the vaccine globally. The commitment from the 7 countries is a billion doses of the vaccine to poorer countries over the next one year. This is a tall feat given the regulatory and political hurdles that India has been facing over the last few months for getting vaccines and raw materials from USA. The number 1 billion is much less than the need of poorer countries, estimated at 11 billion by the World Health Organisation. The countries also pledged better healthcare infrastructure and sharing of science behind testing and treatment protocols to prevent and control future pandemics.
Green Industrial Revolution
In this year’s summit, the focus was on combating climate change by encouraging a Green Industrial Revolution that moves away from burning coal and fossil fuels and promoting solar, wind and other green energy. 2050 is the magic target year to reach net zero emissions. One can’t help but note the irony that much of the burning of fossil fuels and contribution to pollution stems from the G7 economies; yet the fact that the world’s largest economy, USA, under President Biden is coming towards supporting this green industrial revolution provides a ray of hope.
Global Minimum Taxation
The concept of shell companies and use of some countries as tax-havens for large businesses to pay less tax is nothing new. The G7 leaders have floated a landmark accord on Global Minimum Corporation Taxation at 15 per cent and that the taxes must be paid in the countries where the businesses operate. While the suggestion is a step towards a level playing field, bringing all nations to agree, especially sovereign countries that have their own taxation rules, will be a challenge. This has to be passed and accepted at the G20 summit scheduled for July 2021. India as a nation would benefit from this scheme.
Democracy, Freedom and Open Societies
True to its theme, the nations decided to ‘build back better’ in terms of collaboration for better global infrastructure. There was much discussion on doing this in a fair, equitable way, especially with gender equality at its focus. Close to USD 2.5 billion has been committed to a Global Partnership for Education with a thrust on education of girl children. Leading the discussion on ‘Open Societies,’ Indian Prime Minister NarendraModi highlighted the role of the cyberspace as a segue for democracy and freedom but also a space for data theft, misinformation and cyber-attacks.
Chinese Conundrum
Led by Canada and USA, the countries discussed China’s growing economic clout and the nation’s investment in several growing economies, known as China’s Belt and Road Initiative (BRI). To counter this, the G7 countries have promised a united front to support developing nations with infrastructure partnership to the tune of USD 40 trillion over the next 15 years.
The world is very different today than in 1970 when the first group of 7 countries met post the oil crisis. We must take time to ponder if something like the G7 even relevant in today’s world. If equality is really important, can 7 countries dominate the world with their views and decisions? Participation from countries like India definitely shows that we have a place at this elite table, but is our voice loud enough? A definite positive is that the discussions are focused on a few matters of importance. Keep watch if this was just another roundtable of powerful elite or it is much more.
– SahaanaSankar
