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Twenty factions

The G-20’s disarray mustn’t overshadow India’s points

Written by The Indian Express | Published: March 11, 2009 10:47:16 pm

The G-20’s “sherpas” are meeting in London,and they have the tallest mountain in the G-20’s history to climb. The “sherpas”,the term for the senior bureaucrats that serve as assistants to the world leaders attending the main G-20,or “summiteers”,typically meet a few weeks in advance to help set the agenda. Many ideas have come out of these meetings in the past,but rarely has the demand for those ideas been as potent as it is today. And never before has the need for unity,or at any rate co-ordination,in a naturally faction-ridden organisation been so central.

A pity then that the EU and the US can’t seem to agree on the basics. The Americans and the British correctly point out that stimulus plans need to be coordinated in terms of time to be effective — so,if they’re pouring money into their economies,the rest of the big economies should as well. Europe agrees to this on principle,but then points out that,first,the Americans should have asked about timing before they went ahead with a unilateral plan; and second,that raising spending without checking the lax financial standards and shadow banking systems that took everyone’s money in the first place might be throwing good money after bad. And the Anglo-American solidarity isn’t that solid,either: the Obama administration doesn’t quite share Gordon Brown’s crusading zeal against offshore tax havens,for example.

And what of India,at this point? The prime minister’s chosen sherpa,Montek Singh Ahluwalia,will have several points to make,and he’ll have to make them often,and forcefully,to be heard over the din. The most important is to

ensure that developed world governments don’t turn inwards. We’ve begun to see signs of that instinct,most notably in the US. Not only was the stimulus bill back-door protectionist,but the US Congress’s recent move on similar lines to deny funding to a World Bank project that funds cleaner coal plants in countries like India is unacceptable. Ahluwalia needs to

remind the rest of the G-20 what India has repeatedly emphasised,that global recession needs global solutions,and that nothing must slow the engine of recovery: fast-growing emerging economies.

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