Read the following passage and answer the questions The group of twenty or G20 has of late emerged as a very premier forum for international cooperation. The significance of it arises from the fact that its members are the world's advanced and emerging economies. These G20 members altogether represents about 85% of the global GDP, 80% of global trade and two-thirds of the world's population. The G20 originated to overcome the financial crisis that occurred in 1990s in the emerging economies of Asia. This organization is broadly representative and inclusive as the G20 chair has been made rotational annually and a member from different regional grouping of countries is elected to its presidency. Since its beginning, India has actively participated in the G20 process. India is a major stakeholder and also interested in the stability of the world economy. Due to India's support during the Seoul summit development was included as an agenda item and the Seoul Development consensus also emerged. India's interest in G20 has imparted dimension and credibility to G20 deliberation. India's successful organization of G20 summit in New Delhi recently has again ignited hopes for the establishment of a framework for strong, sustainable and balanced growth and an alternative world order.
Which of the following is the reason for the formation of G20?
Asian financial crisis
Understanding the Formation of G20
The question asks about the primary reason for the formation of the G20 forum based on the provided passage. To answer this, we need to carefully read the passage and identify the sentence that discusses the origin of the G20.
Analyzing the Passage for G20 Origin
Let's look closely at the relevant part of the passage:
The G20 originated to overcome the financial crisis that occurred in 1990s in the emerging economies of Asia.
This sentence directly links the origin of the G20 to a specific event: a financial crisis in the 1990s that affected the emerging economies of Asia.
Evaluating the Options
Now let's examine the given options in light of this information:
- Option 1: World financial crisis - The passage mentions a financial crisis but specifies its location and scope as being in "the emerging economies of Asia," not a general "World financial crisis." While the Asian crisis had global implications, the passage identifies the specific regional crisis as the direct trigger for G20's origin.
- Option 2: Asian financial crisis - The passage explicitly states that the G20 originated to overcome the "financial crisis that occurred in 1990s in the emerging economies of Asia." This perfectly matches the description provided in this option.
- Option 3: African financial crisis - The passage does not mention an African financial crisis as the reason for G20's formation.
- Option 4: European financial crisis - The passage does not mention a European financial crisis as the reason for G20's formation.
Conclusion on G20's Origin
Based on the clear statement in the passage, the reason for the formation of the G20 was specifically the financial crisis that occurred in the 1990s in the emerging economies of Asia. Option 2 accurately reflects this information.
| Reason Mentioned in Passage | Corresponding Option | Match? |
|---|---|---|
| Financial crisis in 1990s in emerging economies of Asia | World financial crisis | No |
| Financial crisis in 1990s in emerging economies of Asia | Asian financial crisis | Yes |
| Financial crisis in 1990s in emerging economies of Asia | African financial crisis | No |
| Financial crisis in 1990s in emerging economies of Asia | European financial crisis | No |
Revision Table: Key Facts about G20 Formation
| Aspect | Detail from Passage |
|---|---|
| Origin Reason | To overcome the financial crisis in 1990s in emerging economies of Asia. |
| Members | World's advanced and emerging economies. |
| Representation | ~85% Global GDP, ~80% Global Trade, ~2/3 World Population. |
| Chair Rotation | Annual and rotational from different regional groupings. |
Additional Information on G20 and Financial Crises
The G20 was initially formed in 1999 at the level of Finance Ministers and Central Bank Governors as a response to the global financial instability of the late 1990s, including the Asian financial crisis. It was later elevated to the level of Heads of State and Government in response to the global financial crisis of 2008. While the 2008 crisis further solidified its role, the passage focuses on its initial origin related to the Asian crisis.
The Asian financial crisis of 1997-1998 significantly impacted several East and Southeast Asian countries, including Thailand, Indonesia, Malaysia, South Korea, and the Philippines. It highlighted the need for better international cooperation among major economies to prevent and manage such crises.
Important Questions from International Relations
How many articles (sections) are there in the US Constitution?
Why G20 is considered a representative forum?
What is the significance of recently conclucded G20 summit?
Which of the following is the objective of G20
Why has India taken active interest in G20?
