Inflation a key issue the world faces: PM Narendra Modi ahead of G20 Summit

'India as G20 chair has given confidence to Third World'

Days ahead of the G20 summit here under India’s presidency, Prime Minister Narendra Modi has identified inflation as a critical issue facing the world and called the debt crisis “a matter of great concern” for developing countries. He has also stressed the need for fiscal discipline by states.
 

In an interview with the Press Trust of India (PTI) last week, which the news agency released on Sunday, Modi observed that the Covid-19 pandemic had the world recognise India’s human-centric development model, rather than a GDP-centric view. He said the Sabka Saath Sabka Vikas model could be the guiding principle for the welfare of the world.

He listed the successes of India’s G20 presidency and bemoaned previous governments’ diffidence in holding meetings outside of Delhi. The PM credited the bold reforms across several sectors, including the economy, taken by his government in the past nine years for the speed with which India jumped from the 10th to the fifth-largest economy in less than a decade, which conveyed to the world “that India means business”. “We have democracy, demography, and diversity with us. As I said, a fourth D is adding to it – development.”  
 

On international taxation, he counted the delivery of a text of a multilateral convention as one of the successes of India’s G20 presidency. He said this would allow countries and jurisdictions to move forward with a historic, major reform of the international tax system. He said his government’s vision of “welfare of all” guided it even at the global level, as it worked for the inclusion of those who feel their voices are not being heard.
 

Stressing the need for financial discipline, Prime Minister Narendra Modi has warned that populism extracts a great price in the long term and those who suffer its consequences the most are “often the poorest and the most vulnerable”.

“Populism may give political results in the short term but will extract a great social and economic price in the long term,” the PM told PTI in an interview last week. He, according to the news agency, was taking a dig at freebies given by some state governments.

He reiterated that "by 2047, I am sure that our country will be among the developed countries.”

"Our economy will be even more inclusive and innovative. Our poor people will comprehensively win the battle against poverty. Health, education and social sector outcomes will be among the best in the world," the PM said, adding, “Corruption, casteism and communalism will have no place in our national life.”

Flagging inflation as a key challenge before the world, the PM said India’s G20 presidency had member states recognise that timely and clear communication of policy stances by central banks was crucial to “ensure that policies taken by each country to combat inflation do not lead to negative repercussions in other countries”, especially enabling countries to share policy experiences on how they tackle the challenges associated with food and energy price volatility. He said “a GDP-centric view of the world is now changing to a human-centric one” and India is a catalyst.

He stressed India during its presidency backed the inclusion of the African Union as a full member of the group of 20 largest economies and that the country had taken the lead on democratisation of technology and climate change negotiations.

On India's energy transition, the prime minister said: “Our principle is simple -- diversity is our best bet, whether in society or in terms of our energy mix. There are no one-size-fits-all solutions. Given the different pathways countries are on, our pathways for energy transition will be different.” He said India's historic share in cumulative emissions, despite having 17 per cent of the world’s population, has been less than 5 per cent, but it has left no stone unturned to achieve its climate goals. “We are working with other nations to alter the approach from a restrictive to a constructive approach,” he said.

 He bemoaned the past governments’ “unfortunate attitude” of getting things done right here in Delhi, in and around Vigyan Bhavan, “perhaps because it was an easy way out or perhaps because those in power lacked confidence in the people of different parts of the country”.

Modi dismissed objections of Pakistan and China on New Delhi holding G20 meets in the Kashmir valley and Arunachal Pradesh, stating it was natural to have had meetings in every part of the country.

 On the success of India’s G20 presidency, he said India would have held over 220 meetings across 60 cities in all 28 states and eight Union Territories by the time its term ends. Over a hundred thousand participants from around 125 nationalities would have witnessed the skills of Indians. “Over 15 million people in our country have been involved in these programmes or have come in touch with some aspects of them,” he said.

The PM said the country hosted over 13 ministerial meetings, and several successful outcomes have been adopted, including accelerating climate action by democratising it. Agriculture ministers launched the international initiative for research on millets. The energy ministers delivered consensus on the high-level principles for hydrogen and laid a foundation for establishing the Global Biofuels Alliance.

The environment and climate ministers have made progress on the launch of an industry-led Resource Efficiency and Circular Economy Industry Coalition, while setting an ambitious target of achieving a 50 per cent reduction in land degradation by 2040, Modi noted. Labour and employment ministers also agreed on developing an international reference for classifying occupations to enable mutual recognition of skills across borders. This will help demand to meet supply and help industries find human capital, he said.

The trade and investment ministers adopted high-level principles for digitising trade documents, boosting trade, and contributing to Ease of Doing Business, the PM said.

With his government approaching the end of its second term, the prime minister said before 2014, the country saw many unstable governments that could not get much done. “But in the past few years, the people have given a decisive mandate, which has led to a stable government, predictable policies, and clarity in the overall direction,” Modi said.

"For long, India was seen as a country of one billion hungry stomachs. Now, it is one billion aspirational minds and two billion skilled hands. Indians today have a great chance to lay the foundation for growth that will be remembered for the next thousand years. India will be in the world's top three economies in the near future,” he added.