[Answered] Examine the necessity of Global South collaboration in navigating the global economic transformation. Justify the construction of a New Economic Deal for equitable development.

Introduction

As per the World Banks Global Economic Prospects (2024), developing economies face a decadal low growth of 4%, underscoring the urgent need for South-South collaboration amid global economic fragmentation and inequality.

The Global Economic Transformation

The 21st-century economy is witnessing a geo-economic realignment driven by:

1. US-China great power rivalry, reshaping supply chains and trade flows.
2. Technological disruptions through AI, Big Tech dominance, and digital colonialism.
3. De-dollarisation efforts and the emergence of new monetary blocs (e.g., BRICS Pay, Petro-yuan).
4. Decline of multilateralism, with WTO paralysis and weaponisation of sanctions.

This environment challenges the traditional neoliberal order and exposes structural asymmetries faced by the Global South — home to 85% of the worlds population but controlling less than 40% of global GDP (IMF, 2023).

Necessity of Global South Collaboration

1. Economic Sovereignty and Debt Sustainability: Over 60% of low-income countries are in or at risk of debt distress (IMF, 2024). Collective bargaining via platforms like G-77, BRICS, and New Development Bank (NDB) can ensure fairer debt restructuring and escape the debt trap diplomacy of both Bretton Woods institutions and regional hegemons.
2. Trade and Supply Chain Diversification: The pandemic and Ukraine crisis exposed supply chain fragility. Initiatives like Indias SAGAR, Africa Continental Free Trade Area (AfCFTA), and ASEAN-India Trade in Goods Agreement showcase South-led resilience through diversification and localised production.
3. Technology and Digital Autonomy: Digital colonialism by Big Tech demands South-South cooperation in AI governance, data localisation, and cyber norms. The India Stack, adopted by countries such as the Philippines and Morocco, exemplifies scalable South-origin technological models.
4. Climate and Energy Justice: The Global South bears 90% of climate-induced losses but receives only 25% of green finance. Platforms like the International Solar Alliance (ISA) and Global Biofuel Alliance (2023) highlight Indias leadership in equitable energy transition.

The Case for a New Economic Deal

A new economic architecture must reorient globalisation towards equity, sustainability, and human welfare.

1. Institutional Reforms: Democratisation of IMF, World Bank, and WTO voting structures to reflect present GDP shares.
2. Fair Trade and Industrial Policies: Preferential market access for developing economies; protection of infant industries akin to East Asian developmental states.
3. Development Finance: Expansion of the BRICS Bank, Asian Infrastructure Investment Bank (AIIB), and creation of a South Sovereign Wealth Fund to finance infrastructure, health, and education.
4. Debt-Relief Framework: Inspired by the Heavily Indebted Poor Countries (HIPC) initiative but led by the Global South to prevent political conditionalities.
5. Social Contract Renewal: State-led investment in welfare, digital infrastructure, and education to reduce inequality and promote inclusive growth — resonating with Amartya Sens capability approach and UNDPs Human Development Report (2023).

Indias Role as a Bridge

1. Indias presidency of G20 (2023) and Voice of the Global South Summit positioned it as a moral anchor, advocating One Earth, One Family, One Future.
2. Through its Digital Public Infrastructure (DPI) and Vaccine Maitri diplomacy, India demonstrates South-driven global public goods delivery.

Conclusion

Echoing Joseph Stiglitzs Globalization and Its Discontents, a new economic deal rooted in South-South solidarity is essential to democratise globalisation, ensure inclusive prosperity, and restore faith in multilateralism.