As global challenges—from the pandemic to geo-political tensions—continue to pose threat to world economies, Prime Minister Narendra Modi insisted that the G20 nations take lead to rebuild confidence in international trade and investments. For this, he insisted that countries should draw a framework for mapping global value chains (GVCs) which can enhance resilience and help withstand future shocks.
Modi was speaking through a video conference in the G20 Trade and Investment Ministers meet being held in Jaipur.
India had proposed a framework for mapping which aims to assess vulnerabilities, minimize risks, and enhance resilience. The GVCs help companies divide their operations across the world where design of the product, manufacturing of different components, then assembly and marketing take place in different countries. This creates a global value chain. It has become a dominant feature of world trade involving developing, emerging, and developed economies. The process of producing goods is carried out wherever the necessary skills and materials are available at competitive cost and quality. As GVCs were disturbed during the pandemic, there is a need to map them so that world is prepared to deal with any future disturbance.
The prime minister said India believed in a rules-based, open, inclusive, multilateral trading system with the WTO at its core. “India has advocated the concerns of the Global South at the 12th WTO Ministerial Conference. We were able to forge consensus on safeguarding the interests of millions of farmers and small businesses.”
Modi said the G20 countries should pay more attention to MSMEs, given their key role in the global economy. MSMEs account for 60 to 70 per cent of employment and contribute 50 percent to the global GDP. “They need our continued support. Their empowerment translates to societal empowerment. We have been working with our MSME sector to adopt the ethos of ‘Zero Defect’ and ‘Zero Effect’ on the environment. Increasing their participation in global trade and Global Value Chains has been a priority of the Indian presidency.”
The prime minister highlighted that there was global optimism and confidence in the Indian economy. “India is seen as a combination of openness, opportunities and options. During the last nine years, India has become the fifth largest global economy...We have increased competitiveness, and enhanced transparency. We have expanded digitization, and promoted innovation. We have established dedicated freight corridors and built industrial zones. We have moved away from red tape to red carpet and liberalized FDI flows,” Modi said.