By NEWSCOP
Manmohan Singh strode across the red carpeted tarmac, climbed the stairs leading up to his private suite in the Boeing 747, waved back within a minimalist arc as he is wont to, and disappeared inside. He was 30 minutes late, but looked purposeful. As the captain announced departure, we hoped the visit to the G20 summit in London on April 2 would serve some purpose.
With the world reeling under the worst economic crisis since the Great Depression in the 1930s, everyone’s praying that the summit will come up with a coordinated plan to pull the world out of the hole it’s sliding into. The cost of failure is too high to contemplate.
The 19 developed and developing countries and the EU that officially make up the G20 account for close to 90% of world GDP, 80% of global trade and roughly two-thirds of the planet’s population. So, what they decide should matter. However, experts are near unanimous that the differences among the 20 are so wide that it’s unlikely anything concrete will emerge from London.
For India, given the low expectations of any real breakthrough at the summit itself, attention could focus on the two bilateral meetings of Manmohan Singh — with British PM Gordon Brown on April 1 and US president Barak Obama the next day. While Brown and Manmohan have met recently when the former visited India, it will be Manmohan’s first meeting with the new US president.
The world, however, is expecting more from India. Given that most developed economies are contracting, there’s high respect for the two big economies that are actually growing — India and China. ‘Newsweek’ says so in its latest issue while predicting “the Asian Century is almost here’’.
Foreign secretary Shivshankar Menon said that issues other than the economy were likely to figure in the Manmohan-Obama meeting.
The US new policy towards Afghanistan and Pakistan and India’s assertion that the world must recognize Pakistan’s key role in global terror were always likely to figure and the Lahore attack on Monday will only add to the urgency with which the issue is addressed.
The meeting will also be watched for the atmospherics between the two leaders. While there is little doubt that Indo-US relations will continue to grow closer under Obama, many will be watching their body language and try to gauge whether the chemistry matches up to the Manmohan-Bush bonding.
The world will keenly watch what China does. The summit is seen by the western media as China’s first major chance to flex its muscles. Part of the reason lies in the fact that the wheel has turned full circle since the G20 was formed a decade ago in the aftermath of the Asian financial crisis.
That was when the developed world was sitting on its high horse and talking down to the Third World — Asia in particular — on how it must get its house in order. Today, roles have been reversed with the developed world desperately hoping that China and India can pull the world out of recession.
China has also given indications that it recognizes its international clout and means to use it. The most obvious pointers to this confidence have been suggestions on replacing the dollar as the world’s reserve currency of choice and Chinese premier Wen Jiabao saying that China hoped the US would do whatever it takes to safeguard the Asian gaint’s trillion dollar investments in US treasury bonds.
To return to the differences that beset the G20, much of Europe sees greater regulation of the financial sector as the key to resolving the crisis and preventing its recurrence, but is reluctant and fiscally constrained when it comes to offering larger stimulus packages.
The US wants Europe to cough up much more by way of a stimulus, but is averse to the idea of stringent regulation.
The developing country participants, India included, strongly want protectionism to be brought down and the issue will form a key parameter for judging the summit’s success or failure. It’s a principle that all have readily endorsed, but one that invariably proves too slippery to really catch hold of, given the domestic compulsions of each government.
As Menon candidly admitted, each country is likely to define protectionism in terms that best suit its interest. The issue isn’t just a developed versus developing country problem. There are accusations within the developing nations — China against India, for instance.
For the record, the G20 leaders meet is to discuss not just the immediate crisis, but also larger issues like a reorganization of the IMF and the World Bank to give the developing world a greater say in these institutions as well as enhancing the resources available to them.
But those hoping for paradigm-changing shifts in London might be doing so in vain.
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