U.S. President Joe Biden and other G7 leaders formally launched in Germany the Partnership for Global Infrastructure (PGII).
Details –
PGII aims to fill a huge gap left as communist China uses its economic clout to stretch diplomatic tentacles into the furthest reaches of the world.
This partnership plans to raise $600 billion for global infrastructure programmes in poor countries by 2027.
The target for the U.S. is to bring $200 billion to the table, with the rest of the G7 another $400 billion by 2027.
The funding for this initiative would depend largely on private companies being willing to commit to massive investments.
What is the ‘Partnership for Global Infrastructure’?
At the 2021 G7 Summit, G7 leaders had announced their intent to develop a values-driven, high-impact, and transparent infrastructure partnership.
It was to meet the enormous infrastructure needs of low- and middle-income countries and support the US’ and its allies’ economic and national security interests.
At the 2022, G7 summit, the participating leaders formally launched the Partnership for Global Infrastructure (PGII).
Under this, G7 leaders pledged to raise $600 billion in private and public funds over five years to finance needed infrastructure in the developing countries.
Purpose —
To deliver quality, sustainable infrastructure that makes a difference in people’s lives around the world;
To build infrastructure that strengthens and diversifies supply chains, creates new opportunities, and advances national security of member countries.
Four priority pillars —
Climate and energy security — Tackling the climate crisis and bolstering global energy security through investments in climate resilient infrastructure, transformational energy technologies.
Digital connectivity — Developing, expanding, and deploying secure ICT networks and infrastructure to power economic growth and facilitate open digital societies.
Gender equality and equity — Advancing gender equality and equity by investing in –
care infrastructure that increases opportunities for economic participation by women,
improved water and sanitation infrastructure that addresses gender gaps in unpaid work and time use.
Health and health security — Developing and upgrading the infrastructure of health systems and contributing to global health security.
India and PGII –
The U.S. has announced several flagship projects under the PGII. One of these projects will back Indian infrastructural initiatives.
Under this, the U.S. International Development Finance Corporation (DFC) will be investing up to $30 million in Omnivore Agritech and Climate Sustainability Fund.
This is an impact venture capital fund that invests in entrepreneurs building the future of agriculture, food systems, climate and the rural economy in India.
The fund seeks to invest in companies that increase food security and promote both climate resilience and climate adaptation in India.
It also seeks to improve the profitability and agricultural productivity of smallholder farms.
PGII and China –
The PGII is seen as an attempt to check China’s influence in the developing world by delivering game-changing projects to close the infrastructure gap in these countries.
It is aimed at countering China’s multitrillion-dollar Belt and Road project.
Belt and Road Initiative –
China’s Belt and Road Initiative (also known as One Belt, One Road (OBOR)) envisages the construction of a maze of road, rail and port projects through a number of countries.
It aims to strengthen Beijing’s economic leadership through a vast program of infrastructure building throughout China’s neighbouring regions.
This initiative is called “21st century silk road,” and is made up of —
a belt of overland corridors (also known as silk road economic belt)
.png)