In this process, the Group 77 developing countries which had emerged as independent nation states after the end of the second world war finds itself in oblivion. The earlier G-20 set up by emerging countries under stable capitalist system to bargain with G-7 for supplies of capital and technologies for their economic growth on fair terms too has now lost its role and relevance by their co option by G-7 in the global economic and political - strategic order. There is indeed a big void now for developing countries to voice their special needs and aspirations.

Washington wanted to see the G-7 economic policy making by a group of Four that would bring the US, Europe and Japan together with China. A US treasury spokeswoman declined to comment on this. British finance minister Alistair Darling said: “It is not our position that the G-7 is going to be wound up.” G-7 would continue to exist, but with a diminished role. “We will talks about how the G-7 will work on”. . “In the German view, the G-7 should be something like a preparatory body” for the larger Group of 20 nations to function.

The relationship between new G-20 and G-7 too is bound to be tense and full of conflicts and pulls and pressures which can result in loss of their identity as independent nation states. It may also result in the developed countries, in particular USA, reducing the developing countries to the status of neo-colonial dependencies on foreign powers. The majority of developing countries, which have been left out of the new G-20 will suffer unchecked exploitation of their resources, labour and people.

International Financial Institutions - IMF and World Bank - and World Trade Organisation have been called upon by the newly set up G-20 to take more active supervision and regulation of economic activity in all countries. This is supposed to result in free flow of capital, technologies and exchange of goods and services in the global economy. Considering the wide disparity in the resources - financial and natural, under the control of G-7, which remains intact and has certainly not been replaced, as alleged by enthusiasts of globalization process in particular among the so-called emerging developing countries, is bound still to exercise its clout in the functioning of the global economic, political - strategic relations. The marginal increase in the voting share of a few developing countries in IMF and World Bank by 5 and 3 percentage points will not change the balance of power in economic policy decision making. The IMF in its financial stability report has frankly admitted this. It said incoming cash will not be enough and the governments must still bail out private enterprise and markets for development.

The regulation of financial institutions to bail out the corporate business from recession is now the priority concern of the ruling set up in the G-7 countries and this has become the basis for an alliance with the selected developing countries with dynamic markets. This alliance, it is reckoned by them, can enlarge the social and economic base for the capitalist system to survive. The ruling elite in the developing countries too has a stake in the expansion of dynamic markets and capital of private corporate business and thus has developed its vested interests in this alliance. They have come under the impact of economic recession which had been linked to profitable business priorities. For the ruling coteries in the developing countries to deny any blame for the recession is totally unconvincing.

The fact is that the ruling elite in the some of the so-called emerging countries, among them India and Brazil in particular have been active collaborators with the capitalist developed countries and their financial institutions, IMF and World Bank and WTO. If they gained when economic activity under the capitalist system globally was booming, they have now to suffer losses from their linkage with the developed countries and suffer in this dispensation.

So far as India is concerned, G-7 is bound to deal it as a vulnerable country for transfer of its burden, not merely financial but also political - strategic in the world order and to strengthen its hegemony in the whole of South Asia. The ruling elite in India is keen to play the regional super power game and be a rival to China. It had no qualms in breaking up the solidarity of G-77 developing countries and to enter into political strategic partnership with the USA and repudiate its commitment to non-alignment in its relation with military blocks. (IPA Service)