Group of Seven (G7) Summit 2022

Why in the News?

Recently, Prime Minister Narendra Modi went to Germany to attend the 48th G7 Summit.

• The German Presidency had invited Argentina, India, Indonesia, Senegal and South Africa to the G7 Summit in Elmau, Bavaria.

Background:

• It began as the Group of Six in 1975- with a meeting of leaders of the US, UK, West Germany, Italy, France and Japan, as a result of the Oil crisis and global currency exchange issues that decided to meet annually.

• Canada joined in 1976- making it the G-7. The EU leadership is always invited to G-7 meets.

• In 1998, Russia was added to make it the G-8.

• However, after the Russian wars with Georgia in 2008, and the annexation of Crimea in 2014, the club ousted Russia permanently.

About:

• The Group of Seven (G7) is an inter-governmental political grouping consisting of Canada, France, Germany, Italy, Japan, the UK and the US.

• The European Union is a ‘non-enumerated member’.

Criticisms of the G-7:

• First World Elite Club: It is a “First World Elite Club” that hasn’t grown nor has it revised its membership.

  • Given that not all of its members are among the world’s top economies anymore.

• Concentrated in the hands of a few: The G-7 countries represent more than 50% of Global GDP and just 10% of the world population, showing how much is concentrated in the hands of a few.

• Polarisation in two blocs: By cutting out Russia and China, the G-7 ensure the polarisation of the world into the two blocs, even as ties between Russia and China get stronger.

Key outcomes of the Summit:

• Commitment on Ukraine: G-7 countries underlined their condemnation of what they called “Russia’s illegal and unjustifiable war of aggression against Ukraine”.

  • They will support Ukraine “for as long as it takes” with financial, humanitarian, military, and diplomatic support.

  • Their combined monetary support this year totals to nearly 3 billion in humanitarian aid and nearly 30 billion in budget aid.

• Sanctions on Russia: An equally strong commitment to impose costs on Russia –

  • Coordination on sanctions, especially on the prohibition of transport of oil through sea routes.

  • Contracting its central bank’s foreign reserves.

  • Reducing its military’s access to funds and components.

  • Pursuing Russian oligarchs

• Global Food Security: G-7 parties remained on target to raise $100 billion and lift 500 million from malnutrition by 2030.

• Partnership for Global Infrastructure and Investment: Plan to mobilise $600 billion over the next five years to narrow the global investment gap- in a message to China and concerns over unsustainable debt creations.

• Climate Change: To ensure they are able to keep global warming levels between 1.5 and 2 degrees Celcius.

• Resilient Democracies: India also signed on to it, committing to ensure

  • Free and fair elections

  • Protection of civil society

  • Promote human rights online and offline, and

  • Achieving gender equality.

  • The purpose of this statement was to distinguish the G7- and its special invitees as democracies from authoritarian countries like Russia and China.

• LiFE Campaign: Indian Prime Minister highlighted Global Initiative for LiFE (Lifestyle for Environment) campaign.

  • The goal of this campaign is to encourage an eco-friendly lifestyle.

Impact on India:

• India’s tightrope walks: India’s tightrope walk between the West and Russia-China has become more difficult.

  • Even if the much-needed Russia-Ukraine peace is reached, the G7 declaration implies a point of no return between the two blocs.

• More scrutiny of India’s economic links with Russia: It includes the import of Russian oil, now hitting about 25% of India’s imports, Coal and Cement, as well as payment mechanisms being explored to subvert western sanctions.

• The US-China rivalry: With new economic efforts planned, from the Indo-Pacific Economic Forum to the PGII to challenge China’s Belt and Road Initiative, the US-China competition in the Indo-Pacific is set to heat up.

  • Significantly, India joined the IPEF, but India has not signed on to the PGII plan yet.

• India’s commitment at the G-7 Resilient Democracies: The statement will keep the government accountable at upcoming democracy and religious freedom summits in the UK and then the US.