According to experts, the G20 Presidency with India is assisting New Delhi in fostering closer commercial connections with member countries and giving it a chance to entice foreign investment in areas like infrastructure.
As its members account for over 85% of the world's GDP (Gross Domestic Product), 75% of its commerce, and two-thirds of its population, they are believed to play a crucial role in ensuring future economic growth and prosperity.
The analysts noted that India has a chance to capitalize on this global forum's presidency by showcasing its strengths and accomplishments to draw in investment and strengthen its trade ties with these powerful economies.
Fast-tracking free trade agreement negotiations, ease of doing business, the development of modern infrastructure, trained labor, and a sizable population with rising incomes are a few advantages that aid India in increasing trade realizations with these members.
There are 43 members of the G20, not 20. These include the European Union (a 27-member organization) and 19 nations (Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Korea, Mexico, Russia, Saudi Arabia, South Africa, Türkiye, UK, and US). France, Germany, and Italy are three of the 19 nations that make up the EU.
Trade experts advised the government to expedite ongoing FTA negotiations with nations like the UK and EU since it would help India get better market access to these nations and ease investment.
They also requested that trade venues not be used to advance climate goals because doing so may impede the advancement of both trade and climate negotiations.
The carbon border adjustment mechanism will go into effect on October 1 this year, making exports from nations like India more expensive. The EU is the largest trading bloc in the G20.
"The EU enacted five trade and climate change legislation in the first eight months of 2023. Before individual nations rush to the WTO, the G20 nations should tackle this issue since it is the "elephant in the room." Ajay Srivastava, co-founder of the think tank Global Trade Research Initiative (GTRI), claimed that this could soon cause the collapse of global trade.
According to Shardul S. Shroff, Executive Chairman of Shardul Amarchand Mangaldas & Co, India should work with the G20 to establish itself as a global leader in the digital economy and leverage that position to increase exports of IT and IT-enabled services.
According to Shroff, India should take the lead in establishing international standards for the digital economy's multiple facets, including data protection, international contracting, digital assets, and international taxation, as doing so will increase the country's presence in the world market for services exports.
Global businesses will continue to invest in India because it has the greatest expanding middle-income population, providing a huge consumer base for both goods and services, according to Gaurav Dani, founding partner of INDUSLAW.
Rumki Majumdar, economist at Deloitte India, expressed a similar opinion, stating that the G20 Presidency will benefit India in luring numerous global corporations searching for alternative locations for investment and supply chain diversification.
According to Deep Kapuria, chairman of the Hi-Tech Group, significant improvements in infrastructure, ease of doing business, a skilled labor force, and a developing market with a sizable middle class customer base are some of the main characteristics that make India one of the most desirable countries to invest in and import high-quality goods.
Sharad Kumar Saraf, a Mumbai-based exporter and the chairman of Technocraft Industries, predicted that trade between India and G20 nations will increase quickly as a result of the members' increased comfort and confidence following India's numerous events in various locations.
This contributed to showing the nation as a whole. For India, the G20 Presidency has opened up a wide range of prospects. India now has the chance to seize it. According to Saraf, India should think about turning the G20 into an economic bloc with slightly looser trade restrictions and perhaps cheaper customs fees for group members.
In 2022, India will rank ninth among the G20 nations in terms of total trade in goods and services ($1,662 billion). The top three countries are the EU (17,151 billion), China (7,183 billion), and the USA (6,933 billion).
In 2022, G20 countries accounted for 64.4% of India's merchandise exports and 52.4% of its imports.
The top five G20 countries for Indian exports are the United States ($91 billion), the European Union ($87 billion), China ($17.5 billion), the United Kingdom ($14.4 billion), Turkey ($10.7 billion), and Saudi Arabia ($10 billion).
China supplied the nation with USD 118.5 billion last year, followed by the EU with USD 59.1 billion, Saudi Arabia with USD 43.3 billion, the USA with USD 38.4 billion, Russia with USD 34 billion, Australia with USD 19.2 billion, Korea with USD 18.9 billion, and Japan with USD 13.9 billion.
India's top exports to these member nations in 2022, according to industry, included electronics and machinery (USD 41.3 billion), petroleum products (USD 30 billion), cut and polished diamonds and gold jewelry (USD 25.9 billion), organic chemicals (USD 20.5 billion), medicines (USD 16.4 billion), and automobile parts (USD 11.8 billion).
Electronics (worth USD 46.6 billion), machinery (USD 42.5 billion), petroleum products (USD 40.6 billion), organic chemicals, APIs (USD 18.9 billion), rough diamonds and gold (USD 17.6 billion), raw materials for plastics (USD 13.0 billion), and iron and steel (USD 12.8 billion) were the main imports.
The US is the largest investor in terms of foreign direct investments (FDI), accounting for USD 61.3 billion, or 9% of India's FDI from April 2000 to June 2023, when it totaled USD 645.4 billion.
Japan came in second with a contribution of USD 40 billion (or 6%), followed by the UK (USD 34.3 billion, or 5%), Germany (USD 14.25 billion, or 2%), and France (USD 10.62 billion, or 1.64%).
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