Prioritising agriculture and energy at G20

As India assumed the Presidency of the Group of Twenty (G20) at one of the more uncertain periods in human history on 1 December 2022, Prime Minister Narendra Modi unveiled his government’s priorities while leading the group of the largest and the most powerful countries. India’s agenda, he said, would be one strengthening cooperation and coordination between the G20 countries by depoliticising the “global supply of food, fertilisers and medical products, so that geo-political tensions do not lead to humanitarian crises”. He argued that the ‘greatest challenges’ that humanity faces, including those arising from climate change, among others, “can be solved not by fighting each other, but only by acting together”[i].

This imperative of ‘acting together’ cannot be emphasised more in the engagements of the G20 countries in two areas that are critical for the survival of life on the planet. One, G20 must collectively address the chronic problems of hunger and food insecurity in developing countries, which requires a more resilient and sustainable agriculture and food supply systems. For the latter objective to be realised, G20 must keep in focus countries having large shares of population dependent on agriculture for their livelihoods. Secondly, the G20 countries must take urgent steps for expedited energy transition, without which the target of preventing the earth’s temperature from rising above 1.5 degree Celsius over the pre-industrial levels cannot be realised. In both these areas, India has made significant strides in the recent past, and its experience can, therefore, provide useful guideposts for collective action by G20.

Sustainable food production systems for freedom from hunger and food insecurity

In 2015, when the Sustainable Development Goals (SDGs) were adopted, there was a sense of optimism among signatory countries that by 2030, the global community would be able to “end hunger, achieve food security and [provide] improved nutrition”. It was agreed that these objectives could be achieved by ensuring “sustainable food production systems” and by implementing “resilient agricultural practices that increase productivity and production”. These targets encapsulated the essence of Sustainable Development Goal 2, “Zero Hunger”. But seven years into the implementation of Goal 2, there are signs of retrogression in achieving the targets.

The UN’s SDG Report of 2022 has warned that the “world is on the verge of a global food crisis, with a rising number of people experiencing hunger and food insecurity”, and that this scenario has been prevailing even before the COVID-19 pandemic. With the onset of the pandemic millions faced acute food insecurity as it caused unprecedented levels of disruption of lives and livelihoods. According to UN, as many as 828 million people may have suffered from hunger in 2021. Russia’s invasion of Ukraine in March 2022 dealt another severe blow. The war directly jeopardised nearly a third of global exports of wheat that originated from the two countries in conflict. Further, fertiliser exports from Russia were hampered due to the sanctions imposed by the Western alliance on Russia that resulted in supply shortages in several major agriculture producing countries, including India. This caused, according to the UN Global Crisis Response Group on Food, Energy and Finance, the “largest cost-of-living crisis of the twenty-first century”[ii]as the Food and Agriculture Organisation (FAO) Food Price Index went up by nearly 18 per cent between January and March 2022. Although food prices have softened during the second half of 2022, cereals, dairy, and meat prices continue to be higher than what they were at the beginning of the year. The Russia-Ukraine conflict and the resultant adverse effect on the global food systems exacerbated an existing threat to agriculture and food security caused by climate change, which, according to the FAO, “will make the challenge of ending hunger and malnutrition even more difficult”.[iii] Given the persistent nature of global uncertainties and the heightened threat to food systems that the world has seen in recent past needs collective efforts from G20, the countries that are most equipped to do so, especially due to the varied and rich experiences that they can bring to the fore. India is in a unique position to contribute to these efforts for it has the experience of turning around from being a chronic food insecure country in the past[iv].

Agriculture and food security, and in particular the threat posed to the food systems by climate change, appeared on the G20 agenda for the first time in the Pittsburgh Summit in 2009. The Summit led to the establishment of the Global Agriculture and Food Security Programme (GAFSP), a Financial Intermediary Fund within the World Bank Group and supported by several advanced country governments and multilateral institutions as well as the Gates Foundation. GAFSP's mandate is “to build resilient and sustainable agriculture and food systems in low-income countries, in times of crisis and beyond”[v]. However, with a current portfolio of just $2 billion, scaling up of its functions appears to be a constraint facing GAFSP.

In 2014, the G20 countries took a more ambitious step through the adoption of the Food Security and Nutrition (FSN) Framework based on a food systems approach[vi].The Framework identified three “Priority Objectives”, namely, (i) increasing investment in food systems; (ii) increasing incomes and quality employment in food systems; and (iii) increasing productivity sustainably to expand the food supply. A number of possible actions were identified under these “Priority Objectives”. These included, (i)promoting infrastructure investment by public-private partnerships for food value chains, (ii) increasing development finance and overcoming agricultural market failure in developing countries, (iii) sharing experience in labour market planning and programmes in the context of rural and agricultural modernisation and (iv) promoting international collaboration in research, development and innovation and adapting them to the needs of developing countries.

Although the Antalya Summit of 2015 had drawn up an extensive plan for the implementation of the FSN Framework, it was only in the aftermath of the food crisis triggered by the COVID-19 pandemic that the G20 members recognised yet again the imperative of improving agri-food systems. Under the Italian Presidency in 2021, the foreign affairs and development ministers of the G20 countries endorsed the Matera Declaration, which recognised poverty alleviation, food security and sustainable food systems as the key to ending hunger. They agreed to pursue ambitious yet “concrete and actionable programmes” through "new and innovative policies and responsible investments in agriculture” … and “sustainable and resilient food, soil, and water management systems”[vii].

Two key components of the Declaration were critical for supporting food security and sustainable food systems. The first was the emphasis on the urgent need for “improving availability of and access to sustainable finance in the food and agriculture sector to effectively enable small-scale and family farmers”. In most developing countries, agriculture has faced chronic under-investment, thus undermining the income generation capacities of small farmers in particular. Secondly, the Declaration underlined the need for adaptation of agriculture and food systems to climate change and supporting biodiversity as a source of climate resilience.

A further step taken by the Matera Declaration was the endorsement to the “Finance in Common Summit”, an initiative of 450 public development banks (PDBs) to support investments for the realisation of the 2030 Agenda and the Paris Agreement. A Working Group on Financing Sustainable Food Systems led by the International Fund for Agricultural Development (IFAD) was tasked with the responsibility of ensuring long-term investments in agriculture. India supported the Matera Declaration since it “reflects the Indian concern for the welfare of small and medium farmers, promoting local food cultures and recognising agri-diversity”[viii].

The focus of Matera Declaration was continued under the Indonesian Presidency, with G20 agriculture ministers agreeing to “build more resilient and sustainable agriculture and food systems that have the ability to withstand shocks and stresses”, recognising the “important role of family and small-scale farming in achieving sustainable agriculture and food systems”.

Besides these structural and institutional reforms, the G20 countries have been emphasising the significance of “an open, transparent and efficient food and agriculture trade that allows developing countries to consider their policy space, subject to the World Trade Organisation (WTO) rules and obligations. It can boost sustainable agricultural growth and increase the diversity and resilience of a country’s food supply, while reducing the cost of food and excessive food price volatility”[ix]. The Matera Declaration and the Bali Agriculture Ministers’ meeting[x] also highlighted the importance of WTO rules for promoting “an Open, Fair, Predictable, Transparent, and Non-Discriminatory Agricultural Trade to Ensure Food Availability and Affordability for All”. The ministers expressed their commitment to sustained supply, in part based on local food sources, as well as diversified production of food and fertilisers to support the most vulnerable from the disruptions in the food trade supply chain. Most importantly, the leaders of G20 emphasised that they would “avoid adversely impacting food security deliberately”.

Almost in the same vein, in Bali, the leaders of G20 reiterated their support for open, transparent, inclusive, predictable, and non-discriminatory, rules-based agricultural trade based on WTO rules.

WTO has indeed a key role to play in ensuring transparency and predictability in agricultural trade and production as several of the critical policy instruments relevant for this sector that governments have been using are monitored by the Agreement on Agriculture (AoA). It must, however, be pointed out that the rules laid down by the AoA is not all about maintaining an open and non-discriminatory trading system. It also emphasises that non-trade concerns, including food security, rural livelihoods and rural development must also be given due recognition[xi]. While the preamble to the AoA speaks of the importance of food security as a non-trade concern, the Ministerial Declaration adopted at the conclusion of the third WTO Ministerial Conference spoke of rural livelihoods and rural development as non-trade concerns that should be realised during the implementation of the AoA. India has been a strong votary of effective implementation of these non-trade concerns, on behalf of the developing countries that have a sizeable workforce dependent on agriculture.

As mentioned above, in the Bali Summit, the leaders of G20 had expressed strong support of the grouping for “open, transparent, inclusive, predictable, and non-discriminatory, rules-based agricultural trade based on WTO rules”. This articulation in the G20 Leaders Declaration is significant for the host country, Indonesia, which has been a strong votary of making the existing AoA rules meet all the parameters that have been identified. What is important to point out is that India and Indonesia, along with a sizeable number of developing countries, have been trying to force changes in several provisions of the AoA, in particular, those related to the subsidies granted by some of the advanced countries to ensure better equity in the markets for agricultural products. This was most evident in the Doha Round negotiations in which the G33 countries had argued that the AoA rules must address the three prime concerns of developing countries, namely, food and livelihood security and rural development[xii].

In this context it is essential to recognise that re-purposing farm subsidies is vitally important for the development of resilient and sustainable agricultural systems. Thus, subsidies that can help in realising the target set by the G20 leaders in Bali of “sustained supply, in part based on local food sources, as well as diversified production of food” that can protect the “vulnerable from the disruptions in food trade supply chain”[xiii] should be encouraged. These forms of subsidies should replace those that are currently being granted to produce large surpluses of food crops, which are then disposed of in the international markets. Such forms of surpluses have historically damaged not only the local food systems in poorer countries but have also disrupted livelihoods dependent on agriculture in these countries.

The advantage for the Indian Presidency is that it can build upon some important decisions that have been taken over the past two presidencies. It may be expected from the Indian Presidency of G20 that it provides an operationally feasible roadmap for realising climate resilient agriculture that recognises the centrality of family and small-scale farmers for developing sustainable food production systems. The importance of such systems is that they can achieve several objectives highlighted by multilateral processes that have thus far appeared to be aspirational, including those identified under the SDGs. But these aspirational objectives need to be effectively implemented for they can potentially offer long-term solutions for addressing rising incidence of food insecurity and vulnerabilities, exacerbated by the pandemic-induced crisis and the Russia-Ukraine conflict. Three of these solutions are particularly important, which should be focused on by the Indian Presidency.

First, sustainable production systems can support sustainable livelihoods, provided they are backed by adequate investments, including those for developing appropriate institutions. This is possible if the PDBs meet their commitments to invest in sustainable food and agriculture systems, which were recognised in the Matera Declaration. Besides, the Governments of G-20 countries must re-purpose their farm support through instruments that can promote sustainable food and agriculture systems. G20 should set the principles for providing farm support that can be adopted globally.

Secondly, the “farmer-first” strategy needs to be harnessed using traditional knowledge systems, including those for the conservation and sustainable use of agri-biodiversity. This would require maximising the contributions of ecosystems and by improving resilience, which should arrest biodiversity loss. These initiatives can go a long way if the G20 countries take steps to ensure that the ongoing multilateral negotiations for providing legally binding protection to traditional knowledge holders reach early fruition.

Thirdly, the open, transparent, predictable, and non-discriminatory multilateral trading system, which was an overarching objective of establishing the WTO, must become a reality that would allow agri-food trade to flow so as to contribute to food security and nutrition.

Energy transitions to ensure avoiding the climate catastrophe

Energy transitions have been considered as one of the major pathways for reducing the threats posed by greenhouse gas (GHG) emissions and to meet the targets set by the United Nations Framework Convention on Climate Change (UNFCCC)[xiv]. Early evidence justifying the focus on energy transitions was provided by the third national communications from Annex I Parties to the Convention[xv], which provided an overview of trends in GHG emissions during 1990-2000. The trends showed that while the overall emissions of greenhouse gases (GHGs) had declined, emissions from the energy industry increased by 10 per cent[xvi]. Recent years have shown more alarming trends. The International Energy Agency (IEA) reported that in 2021, electricity and heat production accounted for 46 per cent of the global increase in emissions, the highest increase in CO₂ emissions for any sector[xvii].

Appropriately, the Glasgow Climate Pact called on governments to accelerate transitions towards low-emission energy systems, for the first time in UNFCCC history[xviii].The Pact urged the member states to “accelerate the development, deployment and dissemination of technologies, and the adoption of policies, to transition towards low-emission energy systems, including by rapidly scaling up the deployment of clean power generation and energy efficiency measures…”[xix]. The focus on energy transitions remained in the Sharm el-Sheikh Implementation Plan, which emphasised the “urgent need for immediate, deep, rapid and sustained reductions in global greenhouse gas emissions by Parties across all applicable sectors, including through increase in low-emission and renewable energy …”[xx] Fast tracking energy transitions is vital for limiting the rise in global average temperatures to well below 2 degrees Celsius and as close as possible to 1.5 degrees above pre-industrial levels, as was agreed to in the Paris Agreement in 2015[xxi].

Energy transitions have, thus, emerged as a key component of the global responses to climate change. When India assumed the Presidency of G-20, Prime Minister Modi identified energy transitions as one of the greatest challenges that the global community faces at this juncture, signalling that this issue would be one of the most important planks for the G20 engagement under the Indian Presidency[xxii]. Central to undertaking meaningful energy transitions would be the ability of the G20 members to show directions on ways of reducing their continued dependence on fossil fuels. In the recently concluded G20 Summit under Indonesia’s Presidency in Bali, the G20 leaders agreed to pursue efforts to limit the temperature increase to 1.5 degrees Celsius above pre-industrial levels, in keeping with the Paris target, recognising the impact of climate change will be much lower if the earth’s temperature is not allowed to increase to 2 degrees Celsius. They emphasised the need to rapidly scale up the deployment of clean power generation, including renewable energy, and adoption of energy efficiency measures, including accelerating efforts towards the phase down of unabated coal power as well as discouraging the use of fossil fuel subsidies that promote their wasteful consumption.

Over the past few years, the G20 countries have been engaged in discussions to reduce their dependence on fossil fuels, the context of which was provided by the G20 Action Plan on Climate and Energy for Growth developed under the German Presidency in 2017. One of the important elements of this Action Plan was “A Reliable and Secure Framework for the Energy Sector Transition”. The Action Plan argued that the G20 countries “should lead the transition to sustainable and low greenhouse gas emission energy systems, taking into account different national circumstances, needs, challenges and priorities, such as domestic energy resources, economic development, energy access and energy demand dynamics”[xxiii]. Emphasis was laid on a “transition to sustainable and low greenhouse gas emission energy systems that is technically feasible and economically viable”.

Since 2018, the G20 Energy Transitions Working Group (ETWG) has been discussing the diverse approaches towards energy transitions leading to the adoption of cleaner energy systems through shared experiences[xxiv].  Recognising the importance of sustainable and fair energy transitions, the G20 members have identified several critical elements, including innovation in cleaner energy transitions and innovative financing models, in which the members of the grouping could profitably cooperate.

The Indonesian G20 Presidency was able to elevate the grouping’s project of global clean energy transitions to a G20 Leader level priority. In their Declaration, G20 Leaders underlined the “urgency to rapidly transform and diversify energy systems, advance energy security and resilience and market stability by accelerating and ensuring clean, sustainable, just, affordable, and inclusive energy transitions and flow of sustainable investments”[xxv]. They stressed the importance of ensuring that global energy demand was matched by affordable energy supplies and reiterated their commitment to achieve global net zero GHG emissions/ carbon neutrality by or around mid-century. The Leaders endorsed the Bali Energy Transitions Roadmap through to 2030[xxvi] (the “Bali Roadmap”), which would reflect on national circumstances, needs and priorities of the G20 members in their low emission transition pathways towards net zero emissions. The first element of the Bali Roadmap is the “Bali Compact”, a set of inclusive voluntary principles for both members and non-members that could ensure smooth and effective energy transitions in accordance with national circumstances and priorities. The Bali Roadmap is thus in consonance with the Sharm el-Sheikh Implementation Plan, which argued that the “unprecedented global energy crisis underlines the urgency to rapidly transform energy systems to be more secure, reliable, and resilient, including by accelerating clean and just transitions to renewable energy during this critical decade of action”[xxvii].

The second component of the Bali Roadmap is the following set of three core priorities for the G20 ETWG to consider for accelerating the process of energy transitions: (i) securing energy accessibility, (ii) scaling up smart and clean energy technologies; and (iii) advancing clean energy financing. Making energy affordable and accessible to vulnerable households, or in other words, eradicating energy poverty, is one of the major objectives of the Bali Roadmap. As regards its focus on scaling up smart and clean energy technologies, the Bali Roadmap has spoken of the necessity to scale up global public and private funding of the development and demonstration and deployment of clean energy technologies, as well as effective G20 engagement with global clean energy technology partnerships. The latter objective is extremely relevant in view of the generic problem of inequities in the access to the relevant technologies as between the advanced and the developing countries.

Financing clean energy projects has been a vexed issue, and on this issue, the Bali Roadmap calls upon the developed countries to provide enhanced support, including through financial resources to assist developing countries, in continuation of their existing obligations under the UNFCCC, which can help to leverage the trillions required in clean energy investment. The G20 members have agreed to increase the dialogue on investment opportunities in scaling up critical energy transition technologies, supportive policy measures, including discussions on public spending and related flows.

It seems that Russia’s invasion of Ukraine and the subsequent energy crisis has provided the necessary impetus to undertake energy transitions. According to the International Energy Agency, global government spending to support clean energy has increased by over US$ 500 billion since Russia’s invasion of Ukraine, the largest increase being accounted for by the United States’ Inflation Reduction Act[xxviii]. Several other European countries, in particular the United Kingdom and Norway, have also allocated fresh funding to stimulate investment in clean energy. Energy efficiency and low-carbon power generation incentives were enacted in efforts to curb natural gas consumption.

In contrast to the advanced countries, many of the emerging and developing countries have not responded adequately and are at risk of being left behind. The IEA has argued that this situation cannot be rectified unless the international community steps in to help them mobilise the requisite investment in clean energy.

India is an outlier among the developing countries and could play a vital role in stimulating speedy energy transition as it has set for itself an ambitious target of moving towards clean energy power generation for reducing its carbon footprint. In 2022, India was the world’s fourth largest producer of renewable energy, with 40 per cent of its installed electricity capacity based on non-fossil fuel sources[xxix]. The government expects that the country would meet 50 per cent of its energy requirements from renewables by 2030[xxx], which will reduce emissions intensity of India’s gross domestic product (GDP) by 45 per cent as compared to the level in 2005[xxxi].

By way of conclusion

Creating sustainable food production systems that can adequately respond to the rising incidence of food insecurity and vulnerabilities, exacerbated by the pandemic-induced crisis and the Russia-Ukraine conflict, is among the most significant tasks before the Indian Presidency. India would have to build consensus among the world’s most powerful countries to adopt an operationally feasible roadmap for realising climate resilient food production systems, recognising the centrality of family and small-scale farmers for developing sustainable food production systems. This is without doubt a formidable challenge for India, but it must be recognised that the current G20 Presidency can exercise moral persuasion on two counts. The first is that over the past several years, the G20 countries have gradually appreciated the need to support smallholder agriculture for reducing food insecurity and poverty, including through institutional arrangements for meeting the financing needs of this vulnerable group. The second and the more important aspect is that smallholder agriculture is the backbone of India’s agriculture, and the government has consistently sought to respond to the needs of this segment. The Indian Presidency can, therefore, leverage these two factors to ensure that G20 puts in place a long-term plan for the creation of sustainable food production systems globally.

The G-20 countries have been proactively engaged for fast tracking energy transitions at least since the German Presidency in 2017. This process has gathered significant momentum since then. The Indonesian Presidency has taken the discussion within the grouping to the level of concrete action through the Bali Energy Transitions Roadmap through to 2030 that would reflect on national circumstances, needs and priorities of the G20 members in their low emission transition pathways towards net zero emissions. The Bali Roadmap resonates with the Glasgow Climate Pact that called for transition towards low-emission energy systems. Energy transition is equally high on the agenda of the Indian government as Prime Minister Modi included this issue in the list of priorities for the Indian Presidency. Given India’s own experience of making considerable strides towards phasing-in renewables, the energy transitions agenda could make considerable progress under the Indian Presidency, if only concrete steps are taken to garner the necessary financial resources and technologies are available without the incumbrances of the intellectual property protection.