A month ahead of India assuming the G20 Presidency, Chief Economic Advisor V Anantha Nageswaran on Tuesday said India’s focus during the Presidency of the inter-governmental forum will be on macroeconomic vulnerabilities, food and energy security, and trans-border challenges like regulation of virtual assets, among others as the role comes at a time when the global economy is facing the “unknown unknowns”.
“India’s G20 Presidency begins in the next thirty days. Global economy is subject to headwinds, uncertainties. We are dealing with unknown unknowns and not known unknowns,” Chief Economic Advisor V Anantha Nageswaran said at ICRIER’s 14th Annual International G-20 Conference.
“G20 presidency will focus on key issues on macroeconomic vulnerabilities in the near term which deal with food and energy security. These challenges have emerged partly because of the long-standing under investment in energy infrastructure, but also geo-political developments,” Nageswaran said.
Nageswaran added that going forward the second key issue that may be deliberated upon will be the manner in which multilateral institutions which can be empowered to cater to the development financing needs of emerging economies.
According to the CEA, India will also seek to address challenges pertaining to the regulation of virtual assets. “The third objective will be to identify consensus based solutions to accelerate the scale of response to the global commitment to trans-boundary challenges like regulation of virtual assets, dealing with cross border remittances, and global capital flows. It may be noted that the ministry of finance has finalised a consultation paper on cryptocurrencies. The ministry has held wide ranging consultations with domestic stakeholders as well as global agencies like the IMF and WB while preparing the consultation paper.
India has been in favor of a global regulation of cryptocurrencies as it believes that the nations that opt to prohibit crypto will not be able to successfully do so in absence of a global consensus. A broad common framework can follow once there is a global consensus around the regulations, it believes.
The macroeconomic challenge of spillovers from the developing countries will also be one of the points that will be taken up during the presidency of India at the G20. The high commodity prices leading to inflation spiral and the subsequent monetary tightening by the global central banks has had a negative impact on emerging economies. A buffer and safety net for developing countries, which get affected by the spillovers from the developing countries, is also likely to be taken during India’s one year G20 Presidency beginning in December this year, Nageswaran pointed out.