International Organizations

U.S. pick Ajay Banga confirmed as next president of World Bank

Context: The World Bank confirmed Ajay Banga was selected as its next president on Wednesday, taking charge at a pivotal time for the development lender as it looks to better address climate change. The Bank’s board voted to approve his leadership for a five-year term. He will take over the role from David Malpas in June.

About world bank

World Bank came into existence in the year of 1944 along with IMF at the meeting of the UN Monetary and financial conference, commonly known as the Bretton woods conference.

Now it has 189 members

India is one of the foundational members of the world bank

World bank Organization

The World Bank is like a cooperative, made up of 189 member countries.
These member countries, or shareholders, are represented by a Board of Governors, who are the ultimate policymakers at the World Bank.
Generally, the governors are member countries' ministers of finance or ministers of development.
They meet once a year at the Annual Meetings of the Boards of Governors of the World Bank Group and the International Monetary Fund.

World Bank is not a single entity rather it is a group of five institutions

IBRD

Created in 1944 to help Europe rebuild after World War II.
IBRD joins with IDA, our fund for the poorest countries, to form the World Bank.
They work closely with all institutions of the World Bank Group and the public and private sectors in developing countries to reduce poverty and build shared prosperity
The International Bank for Reconstruction and Development (IBRD) is a global development cooperative owned by 189 member countries.
As the largest development bank in the world, it supports the World Bank Group’s mission by providing loans, guarantees, risk management products, and advisory services to middle-income and creditworthy low-income countries, as well as by coordinating responses to regional and global challenges.

IDA

The International Development Association (IDA) is part of the World Bank that helps the world’s poorest countries.
Established in 1960 and headquartered in Washington DC, IDA aims to reduce poverty by providing zero to low-interest loans (called “credits”) and grants for programs that boost economic growth, reduce inequalities, and improve people’s living conditions.

IFC

Established in the year 1956
Headquarters at Washington DC
It makes investments in productive private enterprises in association with private investors.
It concentrates on areas where sufficient private capital is not forthcoming on reasonable terms and conditions.
It acts as a clearing house for bringing together investment opportunities, private capital and experienced management.
It stimulates the international flow of capital.
It assists the development of capital markets in less-developed countries.
It encourages private sector activity in developing countries through three types of activities.

MIGA

MIGA is the World Bank Group’s most recent agency (1988), created in Washington DC with the aim of attracting private capital to unfavourable environments, usually countries with a lower level of income and in contexts that are unappealing for investments.

This agency works as a complement to the IFC, providing guarantees to foreign investors against so-called “political risks”, which are risks related to the country where the investment will be applied, such as:

Losses related to currency convertibility (difficulties in converting local currency into dollars or euros) and transfer restrictions of the same nature;
Countries in violent contexts (wars, etc.);
Contractual violations by local governments which place the investment at risk;
Seizure of private investors’ assets or properties and failure to meet financial obligations on the part of the Host State

ICSID

It was established in 1966 by the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (the ICSID Convention).
The ICSID Convention is a multilateral treaty formulated by the Executive Directors of the World Bank to further the Bank’s objective of promoting international investment.
ICSID is an independent, depoliticized and effective dispute-settlement institution.
Its availability to investors and States helps to promote international investment by providing confidence in the dispute resolution process.
It is also available for state-state disputes under investment treaties and free trade agreements and as an administrative registry.
ICSID provides for the settlement of disputes by conciliation, mediation, arbitration or fact-finding.

Internal Chaos, External Crisis

Context: Pakistan Foreign Minister Bilawal Bhutto Zardari’s visit to India is bound to generate much media interest but will make little dent in the indifferent relations between the two countries. Any meaningful change in bilateral relations must necessarily wait until Pakistan has a domestic consensus on foreign policy. The vocal opposition in Islamabad to Bilawal’s visit the first by its foreign minister to India in more than a decade underlines Pakistan’s sharp internal divisions about its external relations at a critical juncture in world politics.

Domestic Politics and Pakistan’s Foreign Policy

The lack of agreement on India is only one part of Pakistan’s foreign policy problem. The bigger tussle has been on finding a sustainable approach to Pakistan’s engagement with the major powers that are at odds with each other—US, China, and Russia.
Pakistan is also facing new challenges in Afghanistan and is struggling to cope with the shifting geopolitical dynamic in the Middle East.
Further there has been latest attacks on the former chief, General Qamar Jawed Bajwa ( Army- the second state). Media has accused Bajwa of making major “compromises” with India on Kashmir; they also alleged that he was claiming that the Pakistan army is in “no position to fight” India.
Army in the past has made endless meddling in domestic politics. Army helped install Imran Khan as the PM in 2018 and chose to pull him down in 2022. It also unseated Nawaz Sharif on flimsy grounds in 2017 and allowed the Sharif family to come back into the mainstream in 2022.
Though the impact of Army on domestic politics needs continuous evaluation, it did during the last regime tried to reorient Pakistan’s foreign policy and made a major effort to improve ties with India. The testimony of this approach was announcement of a ceasefire agreement in February 2021 which came after heightened tensions following the Pulwama terror attack and Balakot bombing by India’s Air Force and the Pakistani riposte in February 2019

It has been highlighted that the ceasefire agreement was a product of back-channel talks between the Indian national security adviser Ajit Doval and Bajwa. The ceasefire was to be followed by several confidence-building measures to relax tensions between the two countries.

Army move (under Bajwa) to reduce tensions with India were part of a broader effort to rejig Pakistan’s foreign policy. It was a recognition that current policies are accelerating Pakistan’s relative decline in the region.
Army’s call to discard Pakistan’s obsession with geopolitics and focus on national development, geoeconomics, and good neighbourly relations underlined the case for Pakistan’s urgent strategic course correction.
At the same time Government (the first state) had an anti-American posturing saw the deterioration of ties with Washington. The government enthusiasm to be seen in Moscow on the day Russian President Vladimir Putin ordered the invasion of Ukraine outraged Europe and the US. Imran also sought to align with Turkey as it sought to wrest the leadership of the Islamic world from Saudi Arabia and picked quarrels with the United Arab Emirates. This in turn undermined the traditional goodwill for Pakistan in the Arab Gulf

Conclusion

Pakistan will need a lot of time and space to get its domestic act together and rebuild a foreign policy consensus. The first priority for India must be to sustain the valuable backchannel to the army leadership in Rawalpindi. Weakened though it is, the Pakistan Army remains the only credible interlocutor for India in the near term.

Backchannel Diplomacy

India and Pakistan have engaged with each other via backchannel from December 2020 till April 2021. However, these talks are at a standstill because of the lack of willingness shown by the two countries to change their stands on the various existing issues.

While Pakistan has welcomed the reports of third-party mediation, India has maintained silence as it goes against its traditional position on diplomacy with Pakistan. India maintains officially that issues with Pakistan are of a bilateral nature that has no space for third party mediation or intervention.

What is Back-Channel diplomacy?

Back-channel talks are used to talk to each other through non-official channels to discuss and resolve the problems facing the countries.
It is conducted through foreign diplomats or neutral Governments trusted by both sides desirous of change in status quo.
It is also a means of restoring the status quo ante in case of difficulties.
It is also conducted by respected figures in public lives who are known for integrity, accuracy, who are capable of clarity, caution and patience and deep knowledge of the issue.

What are the benefits of such a diplomacy?

It enables would-be dealmakers to test the waters—to determine whether the other party is capable of negotiating in good faith—before exploring real commitments.
They can be particularly appealing to high-level leaders who are fearful of a public failure if their efforts to reach a deal collapse.

Backchannel Diplomacy DIPLOMACY IN THE PAST

Such talks had been initiated by General Zia-ul-Haq and Prime Minister Rajiv Gandhi through Jordanian Crown Prince Hassan.
During the Kargil War, Prime Minister Atal Bihari Vajpayee chose an unorthodox back-channel interlocutor, R.K. Mishra.
In 2016, six former Pakistani High Commissioners also travelled to Delhi for a Track-II consultation with nine former Indian High Commissioners, where they met NSA Doval and senior MEA officials

Why backchannel now?

Front door diplomacy is not possible because of a complex past.
Pakistan’s dire economic condition and the mounting pressure from the Financial Action Task Force to shut down all terrorist safe havens or face severe sanctions is clearly one imperative for Islamabad’s willingness to engage via the backchannel even after India’s decision on J&K.
To avoid the possible two Front war. UAE’s geostrategic role as a peace broker: In recent years, the UAE has shifted its attention away from military projection to diplomacy, investment and other forms of soft power.
Abu Dhabi was prime mover in last year’s Abraham Accords between Israel and several Arab states.
UAE played a key role alongside their Saudi counterparts in mediating the 2018 peace deal between Ethiopia & Eritrea.
The UAE has reduced its footprint in Yemen and drawn down its forces in the Horn of Africa. It is looking to scale back in Libya, where it provided both air cover and material support for the rebel forces of Khalifa Haftar; the Emiratis are now backing a political solution to the civil war.
UAE has also sought to reduce tensions with Iran and is leading Arab efforts to reengage with the regime of Bashar al-Assad in Syria, having concluded that the war there has effectively ended and that the only way to advance Emirati interests is through political, diplomatic and commercial means.
UAE’s strong trade & commercial ties to India and Pakistan, and as it is home to millions of Indian and Pakistani expatriate workers makes it uniquely qualified to mediate between the two countries.
UAE is hoping restoration of trade links between two countries.
More ambitious still, it is aiming to secure a viable understanding on Kashmir, which has been flashpoint for several wars since their 1947 partition upon independence from British rule.
South Asian initiative also plays into the UAE’s pursuit of other important foreign-policy objectives. It helps to deepen the partnership with USA by paralleling American efforts to resolve the conflict in neighbouring Afghanistan, where India and Pakistan have competing economic and security interests.

What are the risks?

Back-channel negotiating may foster costly delays and perpetuate impasse they are designed to overcome.
They provide only temporary protection from deal spoilers and public scrutiny.
Such secret negotiations can facilitate early breakthrough agreements but yield diminishing returns when relied on too frequently.

G7 calls for extension of Black Sea grain deal

Context: The Group of Seven (G7) on Sunday called for the “extension, full implementation and expansion” of a Black Sea grain deal that has been essential to export Ukrainian produce through the Black Sea.

About the Black Sea grain deal:

It is an agreement between Russia and Ukraine made with Turkey and the United Nations (UN) during the 2022 Russian invasion of Ukraine.
The Initiative is aimed at the Safe Transportation of Grain and Foodstuffs from Ukrainian ports, also called Black Sea Grain Initiative.
It was signed with the support of Turkey ( which controls the maritime routes from the black sea) and the UN.

Why the Black Sea grain deal was signed?

The Russian invasion of Ukraine in February led to a complete halt of maritime grain shipments from Ukraine, previously a major exporter via the Black Sea.
This resulted in a rise in world food prices and the threat of famine in lower-income countries.
To address the issue the Black Sea grain deal was signed.
Initially, this deal was signed only for 120 days

Finland’s Journey, from Neutral to NATO

Context: Finland joined the North Atlantic Treaty Organization (NATO), becoming its 31st member. This is a significant event, given that NATO security guarantees will extend to this country which shares a 1,340 kilometre border with Russia. This historical moment in NATO’s history was full of symbolism, since NATO had clearly scored an additional point against Russia.

‘Conventional deterrence’ as a response to post-cold War Russian policies:

The main rationale behind Finland’s decision has been to receive additional security guarantees from NATO, which are specified in Article 5 of NATO’s founding treaty. It ‘binds the members together, committing them to protect each other and setting a spirit of solidarity within the alliance’.
Finland’s NATO membership can be viewed through the lens of ‘conventional deterrence’. As described John Mearsheimer this concept as ‘an attempt to persuade an adversary not to initiate a war because the expected costs and risks outweigh the anticipated benefits’.
Finland is certainly not the first and will not be the last neighbour of Russia to join the alliance. Before Finland’s accession, countries such as Norway (1949), Latvia (2004), Estonia (2004), Poland (1999) and Lithuania (2004) were already a part of NATO.
In this scenario, Russia needs to learn how to navigate through these growing complexities, which it is partly responsible for.

Complicated past of Russia and Finland

The ‘relationship between Finland and Russia has been a combination of struggle and compromise. In 1809, the Russian Tsar Alexander I defeated Sweden, acquired Finland, and made it an autonomous Grand Duchy of the Russian empire.
In 1917, the collapse of the Tsarist regime and the Bolshevik Revolution paved the way for the full independence of Finland’. This made Finland pursue a pragmatic security policy which was flexible enough to balance its autonomy with the need for military cooperation with the West.
In the post-war era and during the cold war Finland saved itself from the spread of communist ideology. In 1948, the Agreement of Friendship, Cooperation, and Mutual Assistance was signed between the USSR and Finland, outlining ‘Finland’s desire to stay outside the conflicts of interests between the great powers’. This came to be known as Finland’s ‘neutrality’.
Paasikivi’s line (named after Juho Kusti Paasikivi, the president of Finland between 1946 and 1956) emerged and began to morph into what would eventually become Finland’s foreign policy strategy.
This Paasikivi’s line was based on the idea of peaceful coexistence with the Soviet Union with neutrality being its cornerstone. It helped Finland navigate complex international relations after the turbulent time of the Second World War.
While the Finno-Soviet Treaty of 1948 helped Finland boost trade with the Soviet Union, it became heavily dependent on Moscow thereby making it vulnerable to economic and political overtures from the Soviets.

Policy Change?

There were tensions between Finland and Russia as a result of the flux in domestic politics in both countries. For instance, Nikita Khrushchev was willing to negotiate with Finland and allowed for increased trade and cultural exchange between the two countries, despite the 1950s seeing Finland side with the West when the Soviet Union called for a boycott of the 1956 Summer Olympics in Australia.
Following the collapse of the Soviet Union in 1991, it sought to build closer ties with Russia while also pursuing greater integration with Europe.
The country has been an active participant in European security initiatives such as the Common Security and Defence Policy (CSDP) and the Nordic Defence Cooperation (NORDEFCO). At the same time, it has been able to maintain close economic ties with Russia.
The cooperation between Finland and NATO began as early as in 1994 with the Partnership for Peace (PfP) programme. Finland had the status of an ‘Enhanced Opportunity Partner’ and contributed in a significant manner to the NATO-led operations in the Balkans, Afghanistan and Iraq.

Possible Outcome and wayforward

Finland's accession to NATO gives the impression that Finland’s security concerns are mostly assuaged.
However Russian authorities have signalled possible ‘countermeasures’ to the alleged ‘assault on its security and national interests’.
International political scientist believe that Russia and NATO should exercise cautious behaviour vis-à-vis the other. NATO and Russia should search for ways out of the constant cycle of implementing ‘measures’ and imposing ‘countermeasures’. During the last decade, a classic example of ‘security dilemma’ has been unfolding, whereby Russia and the West have been enhancing their security and creating a more precarious environment altogether.
Neither Finland nor Russia should see an escalation in their relations. The newly elected centre-right government in Finland should not exaggerate the potential threats from Russia but engage in bilateral dialogue, trying to understand the other’s security concerns. There should be at least some NATO members who would be willing to rely more on diplomatic tools and ‘lower the temperatures’.

Further reading about NATO and accession process
( https://compass.rauias.com/current-affairs/north-atlantic-treaty-organization/ )

India gets elected to UN Statistical Commission

Context: India has been elected to the United Nations Statistical Commission for a four year term beginning January 1, 2024. India secured 46 out of 53 votes in the election to the Commission.

United Nations Statistical Commission

The United Nations Statistical Commission (StatCom), established in 1947, is the highest body of the global statistical system bringing together the Chief Statisticians from member states from around the world.
It is responsible for setting statistical standards and the development of concepts and methods, including their implementation at the national and international level.
The StatCom oversees the work of the United Nations Statistics Division (UNSD) and it is also a Functional Commission of the UN Economic and Social Council.
Since 1999 the Commission meets every year, as set forth by the Economic and Social Council.
Location: Headquarters of the United Nations, New York, United States

Mandate

The terms of reference as set forth in Economic and Social Council resolution in 1946, state that the Commission shall assist the Council:

In promoting the development of national statistics and the improvement of their comparability
In the coordination of the statistical work of specialized agencies
In the development of the central statistical services of the Secretariat
In advising the organs of the United Nations on general questions relating to the collection, analysis and dissemination of statistical information
In promoting the improvement of statistics and statistical methods generally

Elections

The Commission consists of 24 member countries of the United Nations elected by the United Nations Economic and Social Council on the basis of an equitable geographical distribution according to the following pattern

1.African states (5)

2.Asian States (4)

3.Eastern European States (4)

4.Latin American and Caribbean States (4)

5.Western European and other States (7)

The term of office of members is four years.

FUNDAMENTAL PRINCIPLES OF OFFICIAL STATISTICS

The Fundamental Principles of Official Statistics were developed and adopted by the Conference of European Statisticians in 1991, which were subsequently adopted in 1992 at the ministerial level by the United Nations Economic Commission for Europe.
In 1994, these Principles were adopted by the United Nations Statistical Commission.
At its forty-second session in 2011, the Statistical Commission recommended the development of an updated preamble, which was presented and adopted in its forty-fourth session in 2013.
The United Nations General Assembly has endorsed the Fundamental Principles of Official Statistics in 2014, in its 68th session.
These principles are considered a basic framework which all statistical activities developed by national and international organizations must follow in recognizing official statistics as a public good.
It is the first time the Fundamental Principles have received such high recognition at global political level.

International Finance Corporation to stop funding new coal-related infra projects

Context: The International Finance Corporation will stop supporting investments in new coal projects as part of its alignment with the Paris Agreement. The decision comes after a 13-year campaign against IFC's support for a financial intermediary client backing coal in India, which affected communities' livelihoods.

About International Finance Corporation (IFC)

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IFC was founded in 1956 on an idea that the private sector has the potential to transform developing countries.
It is the largest global development institution focused on the private sector in developing countries.
It is a member of World Bank Group.
It focuses on economic development and improving the lives of people by encouraging the growth of the private sector in developing countries.

It helps private sector in variety of ways:

Investing in companies through loans, equity investments, debt securities and guarantees.
Mobilizing capital from other lenders and investors through loan participations, parallel loans and other means.
Advising businesses and governments to encourage private investment and improve the investment climate.

World Bank

Background: The Bretton Woods Conference of July 1944 established the framework for post – World War II international economic cooperation and reconstruction. It resulted in the formation of the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (World Bank). The World Bank provides loans and grants to low and middle-income countries for capital projects. World Bank comprises of the International Bank for Reconstruction and Development (IBRD) and International Development Association (IDA), two of five organizations in the World Bank Group.

Mission of World Bank

The World Bank has two goals: end extreme poverty and promote shared prosperity in a sustainable way.

World Bank Group

The World Bank Group consists of five organizations:

The International Bank for Reconstruction and Development (IBRD): is a global development cooperative owned by 189 member countries. It supports the World Bank Group’s mission by providing loans, guarantees, risk management products, and advisory services to middle-income and creditworthy low-income countries.
The International Development Association (IDA): It was established in 1960 with an aim to reduce poverty by providing zero to low-interest loans (called “credits”) and grants for programs that boost economic growth, reduce inequalities, and improve people’s living conditions. It is the part of the World Bank that helps the world’s poorest countries.
The International Finance Corporation (IFC): is the largest global development institution focused exclusively on the private sector. It helps the developing countries to achieve sustainable growth by financing investment, mobilizing capital in international financial markets, and providing advisory services to businesses and governments.
The Multilateral Investment Guarantee Agency (MIGA): it was created in 1988 to promote foreign direct investment into developing countries to support economic growth, reduce poverty, and improve people’s lives. MIGA fulfils this mandate by offering political risk insurance (guarantees) to investors and lenders.
The International Centre for Settlement of Investment Disputes (ICSID): provides international facilities for conciliation and arbitration of investment disputes.

Note: India is a member of all the organizations of World Bank Group except The International Centre for Settlement of Investment Disputes (ICSID).

Coalition for Disaster Resilient Infrastructure (CDRI)

Context: Fifth edition of International Conference on Disaster Resilient Infrastructure was organised under the aegis of Coalition for Disaster Resilient Infrastructure.

About Coalition for Disaster Resilient Infrastructure

CDRI is a global partnership that aims to promote resilience of infrastructure systems to climate & disaster risks, thereby ensuring sustainable development.
Prime Minister of India launched CDRI during his speech at the UN Climate Action Summit on 23 September 2019.
Objectives of CDRI: CDRI seeks to rapidly expand the development & retrofit of resilient infrastructure towards expanding universal access to basic services, enabling prosperity and decent work.

Functions of CDRI

Raising awareness of the benefits of resilient infrastructure and building linkages with other relevant initiatives to achieve this.
Serving as a platform for knowledge generation and exchange on disaster & climate resilient infrastructure.
Enhancing national and regional standards, codes and guidelines for planning, design, operation & maintenance of infrastructure systems
Enhancing practices and capacities to reduce infrastructure damages and losses from disasters and climate change.
Enabling technological and institutional innovation for resilient infrastructure systems
Making available technical expertise to assist countries to develop resilient infrastructure
Advocating for financial arrangements, including risk transfer, supporting development of resilient infrastructure
Assisting countries to adopt appropriate risk governance arrangements & strategies for resilient infrastructure.

Governance of CDRI: Secretariat of CDRI is located in New Delhi and has three principal bodies: (i) Governing Council (ii) Executive Council (iii) Secretariat.
- Governing Council: Governing Council is the highest policy-making body of CDRI and will have representation from all members of CDRI such that at least two-thirds of the members of the Governing Council represent national governments. Members of. Governing Council shall be co-chaired by representatives of two national governments with India being the permanent co-chair of Governing Council. The other co-chair shall be nominated by rotation by the members of Governing Council, every two years.
- Executive Committee: Managerial body of CDRI that oversees implementation of decisions of Governing Council. It is a 10 member body with Director General being one of the members.
- Secretariat: Secretariat of the CDRI shall be headed by a Director-General appointed by the Governing Council.
Membership: Membership of CDRI is open to national governments, UN Agencies & multilateral banks, private sector, academic & knowledge institutions. Currently, there are 31 member countries of CDRI and 8 member organisations.
Funding: A large share of the estimated fund requirements to cover the core costs over the first five years has been invested by India. There are no obligations on the part of members to make financial contributions to CDRI.

Initiatives under CDRI

Infrastructure Resilience Accelerator Fund (IRAF):
- A US $50 million multi-donor trust fund created by CDRI to support global action on disaster resilience of infrastructure systems, especially in developing countries and small island developing countries.
- IRAF will play a critical role in equipping the Coalition to deliver on improved infrastructure governance, inclusive infrastructure services and diversified knowledge and financing for resilient infrastructure globally.
- IRAF has been established with the support of UNDP & UNDRR and will be managed by UN Multi-Partner Trust Fund Office. IRAF was launched COP 27 of UNFCCC at Sharm El Sheikh, Egypt.
- One of the first initiatives to be supported by IRAF is the Infrastructure for Resilient Island States (IRIS).
Infrastructure for Resilient Island States (IRIS):
- A dedicated initiative co-curated by Small Developing Island States (SIDS) and Coalition for Disaster Resilient Infrastructure (CDRI) partners to promote resilient, sustainable, and inclusive infrastructure development in SIDS. IRIS will cater to all SIDS.
- IRIS will design and implement projects considering the demands and absorptive capacities of SIDS and strive to foster SIDS ownership and leadership in the development of resilient, sustainable and inclusive infrastructure.
- In the initial phase, IRIS will prioritize the needs of the most vulnerable SIDS.It was launched during COP 26 of UNFCCC at Glasgow.
- Focus areas of IRIS are:
  - Improved resilience of SIDS infrastructure to climate change & disaster risks.
  - Strengthened knowledge & partnerships for integrating resilience in SIDS infrastructure.
  - Gender equality and disability inclusion promoted through SIDS infrastructure.
Biennial Report on Global Infrastructure Resilience: Flagship report of CDRI focusing on critical challenges faced by infrastructure due to disaster and climate risks. The report will develop a Global Infrastructure Risk Model & Global Infrastructure Resilience Index (GIRI) and advocate pathways for nature based solutions for disaster resilient infrastructure, conduct review of global goals and targets for resilient infrastructure and finance for disaster & climate resilient infrastructure.
International Conference on Disaster Resilient Infrastructure (ICDRI): Annual conference of CDRI bring together experts and participants from member countries, institutions and organisations to discuss challenges and identify good practices on disaster & climate resilient infrastructure.
DRI Connect: An online platform to connect, learn and collaborate towards improved practices, processes and policies for resilient infrastructure systems.

Oil surges as OPEC+ surprise output cuts shake markets

Context: Globally oil prices surged, posting the biggest daily rise in nearly a year, after a surprise announcement by OPEC+ to cut more production jolted markets.

The Organization of the Petroleum Exporting Countries and their allies including Russia shook markets by announcing further production cuts of about 1.16 million barrels per day (bpd).

How this price is being raised?

Through intentional cut in the oil supplies by the OPEC+ members.

About Organisation of the Petroleum Exporting Countries (OPEC)

OPEC is a permanent intergovernmental organisation of 13 oil-exporting developing nations that coordinates and unifies the petroleum policies of its Member Countries.
In economics terms, OPEC is a cartel (A cartel is an organisation created from a formal agreement between a group of producers of a good or service to control supply or to regulate or manipulate prices).
OPEC provides more than 70% of the world's oil requirements.

History

It was created at the Baghdad Conference on September 10–14, 1960, by Iran, Iraq, Kuwait, Saudi Arabia and Venezuela.

Objective

To coordinate and unify petroleum policies among Member Countries, in order to secure fair and stable prices for petroleum producers; an efficient, economic and regular supply of petroleum to consuming nations; and a fair return on capital to those investing in the industry.

The OPEC Secretariat is the executive organ of the Organization. Located in Vienna (previously in Geneva), it also functions as the Headquarters of the Organization, in accordance with the provisions of the OPEC Statute. It is responsible for the implementation of all resolutions passed by the Conference and carries out all decisions made by the Board of Governors. It also conducts research, the findings of which constitute key inputs in decision-making.
OPEC publications: World Oil Outlook and Annual Statistical Bulletin.
OPEC+ is a group of non-OPEC member countries that also participate in the organisation's initiatives such as voluntary supply cuts in order to further bind policy objectives between OPEC and non-OPEC members. This loose grouping of countries, known as OPEC+, includes Azerbaijan, Bahrain, Brunei, Kazakhstan, Malaysia, Mexico, Oman, Russia, South Sudan and Sudan.

Saudi Arabia agrees to join SCO as a dialogue partner

Context: Saudi Arabia has agreed to join the Shanghai Cooperation Organisation (SCO) as a “dialogue partner”, the latest indication of closer political ties with China.

This is also seen as the step in the direction where Saudi Arabia can later become a full time member of the organization.

The Saudi-Iran Bonhomie

By joining the SCO, Saudi Arabia's security relationship with China is currently blossoming. But this relationship is nothing new and stems back decades before.
The ballistic missile sales from China to Saudi Arabia as far back as the 1980s, with reported sales in 1992, 2007 and 2014. In 2021, the kingdom imported sensitive missile technology from the Chinese military to manufacture its own ballistic missiles
Saudi Arabia, the world’s largest crude supplier, and China, the biggest energy consumer, met to discuss their ambitions for an initial agreement of $29.26 billion.
The United States was Riyadh’s largest trading partner at $76 billion in 2012, but now China, India and Japan have surpassed the United States, with which trade was only $29 billion in 2021
Saudi Aramco signed two deals to build a major refining and petrochemical complex in China valued in the billions of dollars.

It can be concluded that Saudi Arabia is seemingly looking to diversify its global partnerships in the same way that it has been diversifying its economy into non-oil sectors and reducing its dependence on one single source.

Reasons behind blossoming ties

The US is distancing itself from the region as it is no longer dependent on energy imports from the region. It has itself emerged as a significant exporter of both oil and gas.
The relationship between the U.S. and Saudi Arabia entered a fraught timeline since President Joe Biden came into office
Joe Biden announced the end of combat assistance to Riyadh as it led a military campaign in Yemen against the Iran-aligned Ansar Allah, or Houthi, movement.
With the Russia-Ukraine war and the energy prices soared over the conflict and ensuing Western sanctions against Moscow, Washington called on Riyadh to increase production, only for the Kingdom to join with Russia and other members of the extended Organization of Petroleum Exporting Countries (OPEC+) in cutting output.
America knows that its survival in the region is very costly, because it will remain under the strikes of the Axis of Resistance, which has grown and gained great influence in last decade, meaning that the American presence is no longer without cost, but rather the price will rise if US stays.
Now reports have emerged that Saudi Arabia has begun talks to restore ties with Syria, which has been suspended from the Arab League since civil war broke out in 2011
Iran the long-time rival has joined SCO and has showed interest to join BRICS as well and this has prompted Saudi also, which has been aspiring for the same.

About Shanghai Cooperation Organization

It is a permanent intergovernmental international organisation and was formed in 2001. It is a successor of Shanghai five.

Shanghai Five

Shanghai Five, a political association based on the Agreement on Confidence-Building in the Military Field in the Border Area and the Agreement on the Mutual

Reduction of Armed Forces Members: (SCO - UZBEKISTAN)

Members

NINE countries are currently SCO full members: Kazakhstan, China, Kyrgyzstan, Russia, Tajikistan, Uzbekistan, India, and Pakistan became full members in 2017 and IRAN in 2023.

SCO decided to admit India & Pakistan at the Ufa summit of 2015.

India participated for the first time as a full member at the recently held 18th Qingdao Summit of SCO in China that was held in 2018.

Working

The Heads of State Council (HSC) is the highest decision-making body in the SCO.
The secretary general and executive director of RATS is appointed by HSC for 3 Year term.
The Heads of Government Council (HGC) meets once per year to discuss a strategy for multilateral cooperation and priority directions within the Organisation's framework.
Organisation has two permanent bodies — the Secretariat in Beijing (China) and the Regional Anti- Terrorist Structure (RATS) in Tashkent.
SCO RATS: Regional Anti-Terrorist Structure (RATS) of SCO is a permanent body based in Tashkent, Uzbekistan.
The objective of RATS is based upon the Shanghai Convention on Combating Terrorism, Separatism and Extremism. RATS possess information on terrorist organisations and terrorists.

G20 expert group constituted for strengthening MDBs

Context: Under the aegis of India’s G20 Presidency, a 11-member expert group has been set up to explore measures to strengthen multilateral development banks (MDBs).

Professor Lawrence Summers, President Emeritus, Harvard University and N K Singh, former Chairperson of the 15th Finance Commission of India, are co-convenors of the G20 Expert Group.

Objectives for the panel

Making a road map for an updated MDB ecosystem for the 21st century,
Touching upon all aspects of MDB evolution, and mechanisms for coordination among these banks to address and finance global development.
Looking into how can the World Bank contribute towards climate finance, critical for developing and LDCs to make a smooth transition to lower carbon emissions without compromising on growth.

What is a Multilateral Development Bank?

It is an international financial institution chartered by two or more countries for the purpose of encouraging economic development in poorer nations.
MDBs provide loans and grants to member nations to fund projects that support social and economic development, such as the building of new roads or providing clean water to communities.
They originated in the aftermath of World War II to rebuild war-ravaged nations and stabilize the global financial system.
Today, MDBs fund infrastructure, energy, education, and environmental sustainability in developing countries.
Examples: World Bank, Asian Development Bank, Asian Infrastructure Investment Bank.

About G20

Group of Twenty is the premier forum of international economic cooperation. It plays an important role in shaping and strengthening global architecture on all major international economic issues.

Members of G20: 19 Countries and EU. Countries include Argentina, Australia, Brazil, Canada, China, France, Germany, India, Italy, Japan, South Korea, Mexico, Russia, Saudi Arabia, Turkey, UK and USA. G20 members represent around 85% of global GDP and 75% of global trade and 2/3rd of global population.
G20 does not have a permanent secretariat or staff.
G20 presidency rotates among the members and is selected from a different regional grouping of countries. G20 member countries are divided into 5 groups comprising a maximum of four countries each.
Most groups are formed on a regional basis. However, Group 1 includes Australia, Canada, Saudi Arabia and USA) and Group 2 includes India, Russia, South Africa and Turkey do not follow the regional pattern. Group 3 includes Argentina, Brazil and Mexico; Group 4 includes France, Germany, Italy and UK and Group 5 includes China, Indonesia, Japan & South Korea. EU is a not a member of any of these regional groups.
Each year another country from a different group assumes G20 Presidency. The countries in a group are each equally entitled to take Presidency when it is their group’s turn.
G20 Summit is held annually, under the leadership of rotating presidency. G20 initially focused largely on economic and macroeconomic issues, but it has since expanded its agenda to include trade, sustainable development, health, agriculture, energy, environment, climate change and anti-corruption.
G20 Presidency is responsible for bringing together the G20 agenda in consultation with other members. The Presidency is supported by the Troika – previous, current and incoming Presidency of G20. During India’s Presidency, the troika will consist of Indonesia, India and Brazil respectively.
The theme of India’s G20 presidency is Vasudhaiv Kutumbakam or ‘One Earth, One Family, One Future’. The Sanskrit phrase in drawn from Maha Upanishad.
India holds the presidency of G20 from 1st December 2022 to 30th November 2022.
Inception of G20: G20 was founded in 1999 after the Asian Financial Crisis as a forum for Finance Ministers and Central Bank Governors to discuss global economic and financial issues.
Elevation to Leader’s Level: In 2008, G20 was upgraded to Heads of State/Government level in the wake of Global Financial crisis of 2007. In 2009, G20 was designated as the premier forum for international economic cooperation. First G20 Summit took place in 2008 in Washington.

Structure of G20

G20 consists of two parallel tracks: Finance Track & Sherpa Track.
SHERPA TRACK: Headed by Sherpa who is representative of the Leader. Focuses on socioeconomic issues such as agriculture, anti-corruption, climate, digital economy, education, employment, energy, environment, health, tourism, trade & investment.
FINANCE TRACK: Headed by Finance Ministers and Central Bank Governors, who generally meet four times a year, with two meetings being held on the sidelines of World Bank/IMF meetings. Focuses on Fiscal & Monetary Policy, International Financial Architecture, Infrastructure, financial regulation, international taxation etc.
The Sherpas oversee negotiations over the course of the year, discussing agenda items for the Summit and coordinating the substantive work of the G20.
ENGAGEMENT GROUPS: As part of G20 members’ commitment to consult relevant stakeholders communities, dialogue is facilitated through engagement groups, comprising non-government participants from each G20 member. These groups often draft recommendations to G20 Leaders that contribute to the policy making process. Some engagement groups are: Business20, Civil20, Labour20, Parliament20, Science20, SAI20, Startup20, Think20, Urban20, Women20, Youth20.

Other G20 Initiatives

Research & Innovation Initiative Gathering (RIIG): Aims to enhance, intensify and strengthen research & innovation collaboration among G20 member countries. RIIG is further the work of Academic Forum held during the Italian Presidency in 2021, by bringing together science, technology and innovation experts of G20 member countries.
G20 EMPOWER: G20 Alliance for Empowerment & Progression of Women’s Economic Representation (G20 EMPOWER) was launched during G20 Osaka Summit in 2019. It aims to accelerate women’s leadership and empowerment in private sector by leveraging its unique alliance among business leaders and governments across G20 countries.
Space Economy Leaders Meeting: Under India’s G20 Presidency, ISRO is organising fourth edition of Space Economy Leaders Meeting (SELM) to continue deliberations on significance of space in shaping the global economy.

About WORLD BANK GROUP

Set up along with the IMF in 1945 following the Bretton Woods agreements. Institutions under World Bank:

International Bank for Reconstruction and Development (IBRD): Loans to middle-income & creditworthy low-income countries.
International Development Association (IDA): Interest-free loans & grants to governments of poorest countries.
International Finance Corporation (IFC): Lends money to private sector companies of its member countries thereby promoting economic development
Note: IFC has enabled investments into India through launch of Masala Bonds.
Multilateral Investment Guarantee Agency (MIGA): Promotes FDI into developing countries by offering political risk insurance (guarantees) to investors & lenders.
International Centre for Settlement of Investment Disputes (ICSID): Provides international facilities for conciliation and arbitration of investment disputes.

Note: India is a member of all these institutions except ICSID.

World Bank: IBRD + IDA.

World Bank Group: IBRD+ IDA+ IFC+ ICSID+ MIGA.

Structure of World Bank

Board of Governors: Comprises of 189 member countries represented by their Minister for Finance; Highest decision-making body.

Board of Executive Directors: 25 Executive Directors responsible for day-to-day management. Five largest shareholders of World Bank appoint an executive director, while other member countries are represented by elected executive directors.

World Bank President: Selected by Board of Executive Directors for a five-year. As per the convention followed so far, World Bank President has been an American Citizen, while IMF President has been a European.

Reports published by World Bank: Human Capital Index (HCI); World Development Report; Global Economic Prospects; Logistics Performance Index; Women, Business and Law; Global Financial Development Report

STOP TB Partnership

Context: 36th Board Meeting of Stop TB Partnership took place in India.

About Stop TB Partnership

STOP TB Partnership is a UN hosted organisation that aims for a world free of TB, until then, making diagnosis, treatment and care available to all who need it.
It was founded in 2001 to eliminate TB by 2030.
Secretariat: The Secretariat of Stop TB Partnership is hosted and administered by UNOPS in Geneva, Switzerland.
Union Minister for Health & Family Welfare is the current chairman of the Board of Stop TB Partnership.
Membership: Membership of Stop TB Partnership is open to national governments, NGOs, and scientific institutions.

Objectives of STOP TB

Ensure that every person with TB has access to effective diagnosis, treatment & cure.
Stop transmission of TB.
Reduce the inequitable social and economic toll of TB.
Develop, implement and increase access to new preventive, diagnostic and therapeutic TB tools, products & strategies.
Amplify the voices of people with and affected by TB and secure meaningful change through strategic advocacy & communication.

Initiatives by Stop TB Partnership

Global Drug Facility: Stop TB Partnership Global Drug Facility (GDF) facilitates global access to quality-assured, affordable TB diagnostics and treatments. GDF serves three objective:
- Shape the market: GDF works with suppliers, donors & other stakeholders to ensure the availability of quality assured and sustainably priced products that respond to market needs.
- Facilitate access to innovative medicines & diagnostics: GDF provides technical assistance to facilitate the introduction and uptake of innovative medicines and diagnostics in client countries.
- Provide best in class procurement & supply services for tuberculosis medicines & diagnostics.
TB REACH: This initiative aims to identify not diagnosed, not treated or not reported by providing funding to test pioneering approaches that reach more people with TB. TB Reach provides funding for projects that:

Charges Against President Putin of Russia fixed by ICC

ICC has held him responsible for the war crime of unlawful deportation of the population (children) and unlawful transfer of the population (children) from occupied areas of Ukraine to the Russian Federation for violation of the Rome Statute.
These children were taken away from orphanages and childcare homes. Many of these children have been given for adoption in Russian Federation. Law was changed in Russia, by Presidential decrees by President Putin, to expedite the conferral of Russian citizenship.
The war crimes were allegedly committed in Ukrainian occupied territory by Russian Forces on 24 February 2022.
While not a United Nations organization, the Court has a cooperation agreement with the United Nations. When a situation is not within the Court’s jurisdiction, the United Nations Security Council can refer the situation to the ICC granting it jurisdiction.

About International Criminal Court

International Criminal Court (ICC) investigates and where warranted tries individuals charged with gravest crimes of concern to international community, genocide, war crimes, crimes against humanity and crime of aggression.
ICC came into existence by the Rome Statute which established ICC as the world's first permanent international criminal court.
ICC aims to end impunity through international criminal justice, holds those responsible accountable for their crimes and helps prevent these crimes from happening again.
As a court of last resort, ICC seeks to complement, not replace, national courts.
The seat of ICC is in the Hague, Netherlands.

Rome Statute grants ICC jurisdiction over four main cases:

Crime of Genocide: Characterised by specific intent to destroy in whole or in part a national, ethnic, racial or religious group by killing its members or by others means; causing serious bodily or mental harm to members of the group; deliberately inflicting on the group conditions of life to bring about its physical destruction; imposing measures intended to prevent births within the group; or forcibly transferring children of the group to another group.
Crimes against humanity: These crimes constitute serious violations committed as part of large-scale attach against any civilian population. 15 forms of crimes against humanity listed in Rome Statute include offences such as murder, rape, imprisonment, enforced disappearances, enslavement - particularly of women and children, sexual slavery, torture, apartheid and deportation.
War crimes: They are grave breaches of Geneva conventions in context of armed conflict and include, for ex., use of child soldiers, killing of torture of persons such as civilians or prisoners of war; intentionally directing attacks against hospitals, historic monuments, or buildings dedicated to religion, education, art, science or charitable purposes.
Crime of aggression: These consists of armed force by a State against sovereignty, integrity or independence of another State. The definition of this crime was adopted through amending the Rome Statute in 2010.

Geneva Conventions

Geneva Conventions and their Additional Protocols are international treaties that contain the most important rules limiting the barbarity of war. They protect people who do not take part in the fighting and those who can no longer fight.

First Geneva Convention: Protects wounded and sick soldiers on land during war.
Second Geneva Convention: Protects wounded, sick and shipwrecked military personnel at sea during war.
Third Geneva Convention: Applies to prisoner of war.
Fourth Geneva Convention: Affords protection to civilians, including in occupied territory.
Common Article 3: Covers situations of non-international armed conflicts like traditional civil wars, internal armed conflicts that spill over into other States or internal conflicts in which third States or a multinational force intervenes alongside the government.

Additional Protocols to Geneva Conventions

Additional Protocol I: Strengthen the protection of victims of international armed conflicts.
Additional Protocol II: Strengthen the protection of victims of non-international armed conflicts.
Additional Protocol III: Created an additional emblem, the Red Crystal, which has the same international status as the Red Cross and Red Crescent emblems.

Jurisdiction with respect to State Parties

123 countries are State Parties to the Rome Statute of the International Criminal Court. Out of them 33 are African States, 19 are Asia-Pacific States, 18 are from Eastern Europe, 28 are from Latin America and Caribbean and 25 from Western Europe and other States.
ICC has jurisdiction only with respect to crimes committed after the entry into force of this Statute. ICC may exercise jurisdiction only with respect to crimes committed after the entry into force of Rome Statute for that State, unless that State has made a declaration.
A State which becomes a Party to Rome Statute accepts jurisdiction of ICC with respect to crimes listed above.
ICC may exercise its jurisdiction if one or more of the following States are Parties to this Statute or have accepted the jurisdiction of ICC:
1. State on the territory of which the conduct in question occurred or, if the crime was committed on board a vessel or aircraft, the State of registration of that vessel or aircraft.
1. State of which the person accused of the crime is a national.
Acceptance of a State which is not a party to ICC: A State may by declaration lodged with Registrar accept the jurisdiction of ICC with respect to the crime in question. (Ukraine was a not a State Party to ICC. However, Ukraine has accepted jurisdiction of ICC throughout the territory of Ukraine from 20th February 2014 onwards.)

Jurisdiction of ICC

ICC exercises jurisdiction in a situation of genocide, crimes against humanity or war crimes committed on or after 1st July 2002 and:

Crimes were committed by a State Party National, in the territory of a State Party or in a State that has accepted the jurisdiction of ICC. (Since in the present case, the alleged crimes were committed in the territory of Ukraine which is not a State party but has accepted the jurisdiction of ICC, hence ICC has jurisdiction in the present case, despite Russia not being a party to ICC).
Crimes were referred to ICC Prosecutor by the UN Security Council (UNSC) under a resolution adopted under Chapter VII of UN Charter.