G20 meet aims to find 'lasting solutions' to global debt issue: Govt

The first-ever meeting of G-20 finance ministers and central bank governors (FMCBGs) under India’s presidency will look to find lasting solutions to unsustainable debt by some low-and-middle income nations, economic affairs secretary Ajay Seth said on Tuesday.

At a media briefing ahead of the G-20 meeting in Bengaluru, Seth and chief economic advisor (CEA) V Anantha Nageswaran said that the G-20 nations will be looking to take discussions forward on agenda items. These include climate finance, urban infrastructure, crypto assets, multilateral institution reforms and other such issues.

They, however, ruled out any concrete agreement being reached in the meeting on any of these ‘complex issues’.

“There are countries that are facing huge debt problems and our aim in G20 will be to find lasting solutions to these problems.

Another theme we will be working on is how the global community, through multilateral development banks, can come together to address some of the long-term challenges that the world faces,” Seth said.

These include sustainable development goals (SDGs) and challenges arising from climate change and policies. They also include other measures to be adopted by nations to deal with climate change and climate finance, he said.

Yet another area would be around resilient cities and urban infrastructure, an equally-important issue for developing and developed economies, Seth added.

“While we are all concerned about the debt situation in many countries, we also have to think about the ways we can forestall them. The discussion will be on handling these situations before they arise and after they arise,” Nageswaran said.

Apart from the main meeting, there will be bilateral meetings between various nations. Finance Minister Nirmala Sitharaman and Reserve Bank of India (RBI) Governor Shaktikanta Das, who will be co-chairs, will also hold bilateral meetings with their counterparts from G-20 nations.

Seth said that one of the key global economic developments, an international taxation framework on base erosion and profit shifting, was taken up in the meeting of G-20 finance and central bank deputies (FCBDs) in December. Also, the framing of an inclusion framework led by Organisation for Economic Co-operation and Development (OECD) has also seen progress.

The next step would be countries signing the agreement, which is expected to happen later this year, he said.

The G-20 FMCBG meeting on February 24-25 will also be preceded by another FCBD meeting, starting February 22.

On the global economic backdrop of the G-20 meetings, Nageswaran said that “concerns over global growth have somewhat receded at the margins. However, food and energy insecurity issues that we were dealing with last year are still there.”

Seth said that growth is slowing at the global level and will have an impact on global trade. Seth hinted that India will provide its expertise in expanding digital infrastructure for delivery of public goods to other nations.

He said, “We have seen in India and many other countries that digitisation of the economy has led to financial inclusion and productivity gains. All countries can work together to reap the benefits of digital infrastructure that we have used very successfully in India.”

Seth said there will also be separate sessions on crypto assets, digital public infrastructure and payments systems.

“One seminar will be on formulating consensus on regulation of crypto assets. The work is already underway by various organisations on crypto regulations. And, the consequences specially come in from a macro economic perspective, monetary policy perspective and banking perspective — the ambit, scope, and direction of those regulations,” Seth said.