The G20 Summit; What Was The Total Cost Of Prestige, And Can This Huge Cost Be Justified?

The G20 Summit in New Delhi, although deemed a success for India, resulted in estimated losses of around ₹400 crore for local shops and restaurants and had a profound impact on approximately 9,000 delivery workers due to the closure of markets and malls. 

Additionally, according to industry executives, many businesses outside the controlled zone experienced a 50% drop in sales as traffic restrictions forced people to stay indoors.

“Atul Bhargava, president of the New Delhi Traders Association (NDTA), stated that traders in New Delhi suffered an estimated loss of about ₹300-400 crore during the three-day closure,” he explained. The closure affected all commercial and economic establishments in the New Delhi district from September 8 to 10, a necessary security measure for the summit.

Anjan Chatterjee, chairman of Speciality Restaurants, which operates Mainland China and Oh! Calcutta chains remarked, “Both dine-in and delivery numbers dropped by at least 50% in Delhi, with a 20% decline in NCR. This decline is clearly attributed to the hosting of such a large-scale event. Our vendors also faced challenges in delivering supplies during this period.”

Given that the summit coincided with a long weekend, there was an additional loss of business opportunity. Rohit Aggarwal, director at Lite Bite Foods, which operates Punjab Grill, Zambar, and YouMee chains, noted, “In Delhi, our sales decreased by about 50%, and even in Gurgaon, our sales were impacted by about 20%. This substantial economic impact was felt far beyond the controlled areas, affecting the capital as a whole.”

The capital’s top markets such as Khan Market, Connaught Place and Janpath – which are top draws for shopping and dining and attract large numbers of international visitors – missed what would have been a terrific opportunity. The spillover impact was felt across the capital, executives added.

G20 Budget: How Much Has India Spent On Hosting The G20 Summit In Delhi?

Moving on to the budget allocated for hosting the G20 Summit in Delhi, India was prepared to host this prestigious event, scheduled for September 9 and 10 at Bharat Mandapam, New Delhi’s Pragati Maidan. 

The summit boasted participation from numerous world leaders, including US President Joe Biden, UK Prime Minister Rishi Sunak, French President Emmanuel Macron, German Chancellor Olaf Scholz, Australian PM Anthony Albanese, Japan PM Fumio Kishida, and Brazilian President Luiz Inacio Lula da Silva. 

India’s presidency of the G20, which commenced in December the previous year, culminated in this final summit, garnering significant attention and necessitating extensive preparations in the national capital.

Throughout India’s G20 presidency, the country hosted several meetings addressing various sectors such as health, tourism, and finance. These events took place in multiple cities, reflecting the significant expenditure associated with the grand summit in Delhi and the various G20 presidency-related activities.

What Has Been The Cost Of G20 Presidency?

Regarding the cost of the G20 presidency, the budget for 2023-24 allocated Rs 990 crore by the government. The finance minister emphasized during the budget announcement that the presidency provided India with a unique opportunity to enhance its role in the global economic order. 

Notably, in addition to the direct expenses related to the presidency, substantial funds were spent on the preparation of New Delhi for the grand summit. 

A document posted by Union Minister Meenakshi Lekhi on X revealed that over Rs 4,100 crore was invested in various infrastructure improvements, encompassing roads, security measures, footpaths, lighting, and more. 

Additionally, various sculptures were installed at different locations in the national capital as part of the city’s makeover for the event. 

However, detailed direct costs specifically related to the summit in Delhi remained undisclosed.

Historical data indicated that countries have historically allocated significant funds to host G20 summits. 

For instance, Canada spent CAD 715 million on the 2010 summit in Toronto, while the Buenos Aires summit in 2018 incurred costs of $112 million. 

The most recent summit prior to the Delhi event was held in Bali, Indonesia, in November 2022.

Questioning The Costs

Notably, TMC MP Saket Gokhale raised concerns about the expenditure associated with organizing the G20 summit, highlighting that India’s spending was seven times higher than Germany’s spending on hosting the Hamburg summit in 2017. 

He criticized the Modi government for allocating over Euro 449 million, equivalent to over Rs 4,100 crores, exclusively for Delhi, claiming that this expenditure was seven times greater than what a developed country like Germany had spent on the same G20 Summit. 

He argued that a shocking additional Rs. 3500 crores were spent for Modi’s self-promotion in preparation for the 2024 elections.

Minister of State for External Affairs Meenakshi Lekhi, in a post on X, shared a detailed breakdown of the expenditure incurred by Delhi and central government agencies, amounting to approximately Rs. 4,100 crore. 

The expenses encompassed various aspects, including ‘horticulture improvements,’ road construction and paving, installation of signages on roads, street lighting, street furniture, public artwork, footpath enhancement, encroachment clearance, painting and cleaning of foot overbridges, and G20 branding. 

According to the provided table, India Trade Promotion Organisation (ITPO) spent Rs. 3600 crore, while the New Delhi Municipal Corporation (NDMC) spent approximately Rs. 60 crore.

Other contributing entities included the Delhi Development Authority (DDA) with Rs. 18 crore, the Road Transport Ministry with Rs. 26 crore, and the Public Works Department (PWD) with Rs. 45 crore.

The Municipal Corporation of Delhi (MCD) spent Rs. 5 crore, the External Affairs Ministry allocated Rs. 75 lakh, and the Forest Department invested around Rs. 16 crore. The Delhi Police incurred expenses of Rs. 360 crore.

The Viewpoint

• In light of these expenditures, questions inevitably arise about the rationale and justification for such substantial spending in the context of a developing nation like India. 

• The prestige and global recognition associated with hosting major international events must be weighed against the economic losses and significant expenditures incurred, prompting a closer examination of the cost-benefit equation.

• How can a developing country justify spending such a significant amount on hosting an event like the G20 Summit? 

• The G20 Summit in India may have been deemed a success, but it came at a staggering cost of Rs 400 crore in lost business for local traders. 

• Approximately 9,000 delivery workers were affected as markets and malls remained closed in the New Delhi area during the event. Even businesses outside the controlled zone experienced a 50% drop in sales due to traffic restrictions that kept people indoors.

• Atul Bhargava, the president of the New Delhi Traders Association, estimated the losses to be between ₹300-400 crore, all because of the security concerns associated with such a high-profile event. But one has to wonder, was it worth it?

• All commercial and economic establishments in New Delhi district had to close for three days during the summit. Dine-in and delivery numbers plummeted by at least 50% in Delhi, and a 20% decline was observed in the National Capital Region (NCR). This decrease in sales clearly indicates the negative impact of hosting an event of this magnitude. Moreover, the summit coincided with a long weekend, resulting in further missed business opportunities.

• Top markets in Delhi, such as Khan Market, Connaught Place, and Janpath, which are popular among international visitors, lost a golden opportunity. The repercussions of this loss were felt throughout the capital.

So, with all these losses in mind, the question arises: Was it worth it for India to spend such a colossal amount on hosting the G20 Summit in Delhi? 

As we ponder these numbers, one can’t help but wonder if such significant expenditures are justified, especially for a developing country like India. 

Is the prestige and global recognition that come with hosting such events worth the immense economic losses and expenditures incurred?

The Last Bit, The G20 Summit in India was indeed a showcase of international diplomacy and global cooperation, providing an opportunity for the nation to assert its role on the world stage. 

However, the significant economic losses incurred by local businesses, coupled with the substantial budget allocated for the event’s preparations, raise important questions about the trade-off between prestige and economic impact.

In a country like India, where developmental needs are paramount, it is crucial to strike a balance between hosting prestigious international events and addressing the pressing concerns of its citizens. 

As India and other developing nations continue to navigate the complexities of hosting such summits, there is a need for careful consideration and transparent evaluation of the costs and benefits, ensuring that the prestige gained is not at the expense of the well-being of local businesses and communities.