Why in news?

Leaders from the Group of Seven (G7) countries, which include the U.S., Canada, Germany, France, Japan, the U.K., and Italy, met in Apulia, Italy, from June 13-15.

The European Union leadership also joined the summit to talk about various issues. India has been invited to this event 11 times, and Prime Minister Narendra Modi attended for the fifth time.

The G-7 leaders met to discuss bridging differences between the "West and the Rest," funding the Ukraine war, investing in Africa, and addressing migration, climate change, and artificial intelligence.

They agreed to provide $50 billion for Ukraine from Russia's frozen wealth funds and held a summit to promote clean energy in Africa. They criticized China's trade practices and met with leaders from 10 countries, including India, to discuss Global South concerns.

What’s in today’s article?

• Group of Seven (G7)
• Significance of India for G7
• Significance of G7 for India
• Criticism faced by G7

Group of Seven (G7)

• Origin
  • The origin of G7 lies in the oil shocks of 1973 and the corresponding financial crisis.
  • In order to address the situation after oil shock, the heads of the world's six leading industrial nations decided to hold a meeting in 1975.
  • These six nations were - the US, UK, France, Germany (West), Japan and Italy.
  • These countries were joined by Canada in 1976 and G7 came into existence.
• Current Members
  • US, UK, Canada, France, Germany, Italy and Japan are the current members of this group.
  • It can be said that the members of this group are the most developed and the advanced economies of the world.
  • The European Union is also represented within the G7.

Significance of India for G7

• key Global South member
  • India has been a significant part of the G-7 process for years, gaining attention in the 2000s for its steady growth during the global financial crisis.
  • Though not a G-7 member, India is a key Global South member and has hosted the "Voice of Global South" conference since 2023.
• Part of G-20 troika
  • It is also part of the G-20 troika with Brazil and South Africa.
• Economic Growth and Stability
  • India gained attention from the G7 in the 2000s due to its steady economic growth during the global financial crisis, demonstrating its resilience and potential as a major economy.
• Strategic Partnerships
  • India is part of the G-20 troika, along with Brazil and South Africa, which adds to its strategic importance in global economic and political discussions.
• Regional Stability and Development
  • India's involvement in the G7's outreach efforts can contribute to regional stability and development, particularly through investments and cooperation in areas like clean energy, trade, and economic development.
• Geopolitical Balance
  • India's participation helps balance global geopolitical dynamics, especially in the context of rising concerns about China's influence and trade practices.
  • India's strategic position and partnerships are crucial for maintaining global stability.

Significance of G7 for India

• Crucial platform to highlight achievements and perspectives
  • For India, the G-7 outreach session is a crucial platform to highlight its achievements and perspectives.
  • During the session, PM Modi emphasized the importance of Indian elections, technology, artificial intelligence, and addressing climate change.
• Economic Significance
  • As per one estimate (2018), the G7 nations account for
    • close to 60 percent of global net wealth ($317 trillion),
    • 30 percent of global gross domestic product, and
    • about 770 million people or 10 percent of the world's population.
• Political Significance
• Political heavyweights are capable of shaping the response of Multilateral challenges.
• In 1999, it created the Financial Stability Forum in order to manage the international monetary system
• 47^th summit in June 2021 had focused on the recovery from ongoing COVID-19 pandemic. It promised to distribute 1 billion vaccines to poorer countries.
• Its theme was Global Action to Build Back Better.
• Developmental Significance
  • G-7 provided $300 million in 1997 to help build the containment of the reactor meltdown at Chernobyl.
  • G7 played crucial role in setting up a global fund to fight malaria and Aids in 2002.
  • In October 2020, G7 finance ministers backed an extension of a G20 bilateral debt relief initiative for the world's poorest countries
• Advocacy for the Global South
  • India uses the G7 platform to advocate for the concerns of the Global South, such as economic inequality, climate change, and resource security.
  • This advocacy helps ensure that the voices of developing nations are heard in global decision-making processes.
• Technological and Climate Initiatives
  • India's participation in G7 discussions on technology and climate change allows it to contribute to and benefit from global initiatives aimed at addressing these critical issues.
  • It also provides an opportunity for India to share its innovations and approaches.
• Showcasing Democratic Values
  • By participating in the G7, India reinforces its commitment to democratic values and principles, aligning itself with other major democracies and highlighting the importance of democratic governance on the global stage.

Criticism faced by G7

• Elitist, non-inclusive group
  • The G-7 faces increasing criticism for being an elitist, non-inclusive group that excludes three of the world's top 10 economies: China, India, and Brazil.
  • Unlike the G-20, it lacks representation from a broader spectrum of the world.
• Membership Issues
  • The G-7 has not expanded its membership and even reduced it by dropping Russia in 2014.
  • In contrast, BRICS has expanded, now including the UAE, Saudi Arabia, Iran, Egypt, and Ethiopia alongside the original members Brazil, Russia, India, China, and South Africa.
• Challenges to Relevance
  • The G-7's inability to change the course of Russia’s invasion of Ukraine, stop Israel’s bombardment of Gaza, or deter China's global economic influence raises questions about its relevance and effectiveness.
• Future Uncertainty
  • The G-7's future effectiveness is uncertain, especially with potential leadership changes due to upcoming elections in the U.K. and the U.S.
  • The next G-7 summit will be in Alberta, Canada, in 2025, and it remains to be seen if India will continue to participate on the sidelines.