India's G20 playbook offers the world pathways for a recovery

Innovative financing options should be adopted for the global economy to recover evenly and all sustainability goals to be met

- AMITABH KANT & DEEPALI KHANNA

Economic headwinds after covid continue to affect most countries across the world. Countries’ efforts to tackle the post-pandemic impacts on their economies have been stymied by the Ukraine conflict, which has created inflationary pressures and macroeconomic insecurity. The countries of the Global South have particularly been affected, as their rising debt burdens have hampered efforts at promoting sustainable development, placing a question mark on their ability to meet the sustainable development goals (SDGs) or respond to the effects of climate change.

On top of that, rising interest rates, especially in the developed world, are leading to depreciating currencies. This creates a dual challenge. First, the cost of debt increases due to higher interest rates, and second, for each dollar of debt, countries pay more in local currency, owing to depreciating currency value.

For its part, India managed to emerge from the pandemic relatively quickly through a steady V-shaped recovery, and is now one of the world’s fastest-growing economies. However, the widely divergent impacts of these multiple crises on various countries are leading to an ever-widening gap between nations, with dire implications for a globally sustainable future. India is using its presidency of the G20 to put forward the voice, perspectives and priorities of the Global South, pitching an accelerated recovery through the forging of stronger links with the Global North, by calling for reform of the multilateral system, and focusing on the financing of climate and SDG action.