With reference to the “G20 Common Framework”, consider the following statements : 1. It is an initiative endorsed by the G20 together with the Paris Club. 2. It is an initiative to support Low Income Countries with unsustainable debt. Which of the statements given above is/are correct ?
- (a) 1 only
- (b) 2 only
- (c) Both 1 and 2 ✓ UPSC's answer
- (d) Neither 1 nor 2
Why the answer is (c)
• The G20 Common Framework for Debt Treatments, agreed in November 2020, was endorsed by the G20 together with the Paris Club of official creditors, bringing non-Paris Club lenders such as China into a common process — statement 1 is correct.
• It is designed for low-income countries eligible for the Debt Service Suspension Initiative whose debt is unsustainable, offering case-by-case restructuring — statement 2 is correct.
• Chad, Ethiopia, Zambia and Ghana have sought treatment under it, though progress has been slow.
• India, as G20 president in 2023, pushed for faster implementation.
• Hence both 1 and 2, option (c).
Why the other options are wrong
- (a) 1 only
- Statement 2 is also correct: the Framework targets low-income countries with unsustainable debt.
- (b) 2 only
- Statement 1 is also correct: it was endorsed with the Paris Club.
- (d) Neither 1 nor 2
- Both statements are correct.
Asked in the GS Paper I of the UPSC Civil Services Preliminary Examination 2022, held on 5 June 2022. Question and answer key: Union Public Service Commission. Explanation: UPSC Answer Check.