The Paradox of BRICS, its New Pathway

Table of Contents

Context: The article is discussing the dynamics and current status of Non-Aligned Movement (NAM) and various multilateral groupings, such as G-77, South Asian Association for Regional Cooperation (SAARC), Association of Southeast Asian Nations (ASEAN), and BRICS. It acknowledges that some of these groups, like NAM and G-77, had their peak of relevance during the Cold War era but have since lost some of their significance. Despite this, they still exist and continue to operate. It also points out that the SAARC summits, on the other hand, ended in 2014, but the Secretariat of SAARC remains active. It highlights that even though there may be policy divergences among member nations, ASEAN continues to function and issue lengthy communiqués. The article specifically focuses on BRICS, noting that despite its initial achievements, the group has begun to lose its appeal or “sparkle.” Factors such as the COVID-19 pandemic, the Galwan clash between India and China, and the Ukraine conflict have led to increased global economic stress and strained relations between India and China, as well as Russia facing challenges as a global power. Overall, despite this loss of influence, the article highlights the interests of many nations in joining BRICS, creating a paradox.

The Paradox of BRICS, its New Pathway Background

About BRICS

BRICS is an acronym for the grouping of the world’s leading emerging economies, namely Brazil, Russia, India, China, and South Africa.
The major objectives of BRICS are economic cooperation, political coordination, cultural and people-to-people exchanges, global governance reform, South-South cooperation, and peace and security.
Origin: In 2001, the British Economist Jim O’Neill coined the term BRIC to describe the four emerging economies of Brazil, Russia, India, and China.
- The grouping was formalised during the first meeting of BRIC Foreign Ministers’ in 2006.
BRIC to BRICS: South Africa was invited to join BRIC in December 2010, after which the group adopted the acronym BRICS.
Significance: The BRICS nations together represent 41% of the global population, 24% of the global GDP and 16% of the global trade.
Chairmanship: The chairmanship of the forum is rotated annually among the members, in accordance with the acronym B-R-I-C-S. India is the chair for 2021.
Key initiatives by the BRICS:
- New Development Bank: During the Sixth BRICS Summit in Fortaleza (Brazil) in 2014, the leaders signed the Agreement establishing the New Development Bank (NDB – Shanghai, China). It has so far approved 70 infrastructure and sustainable development projects worth.
- BRICS Payment System: BRICS countries are trying to create a payment system as an alternative to the SWIFT payment system. This has taken on a new urgency as post Ukraine war, Russia has been frozen out of SWIFT.
- Contingent Reserve Arrangement: In 2014, the BRICS governments had signed a treaty on the setting up of the contingent reserve arrangement The arrangement is aimed at forestalling short-term balance of payments pressures, provide mutual support and strengthen financial stability of the BRICS nations.
- Remote sensing satellite: BRICS nations signed an agreement for cooperation in remote sensing satellite data sharing. The pact enables building a virtual constellation of specified remote sensing satellites of BRICS space agencies and their respective ground stations will receive the data.

Decoding the Editorial

The article is highlighting the evolution and dynamics of the BRICS grouping (Brazil, Russia, India, China, and later South Africa) in comparison to the IBSA grouping (India, Brazil, South Africa).

Relevance of BRICS:
- Initially, BRIC gained popularity as an acronym representing four emerging economies: Brazil, Russia, India, and China.
- However, two of the BRIC members, Brazil and India, formed a separate grouping with South Africa called IBSA in 2003.
- At that time, China expressed interest in joining IBSA, but Brazil and India insisted that the forum should be limited to democracies.
- In response to being rejected from IBSA, China strategically brought South Africa into the BRIC grouping, transforming it into BRICS. This move resulted in BRICS gaining prominence and overshadowing the IBSA grouping.
- IBSA has been unable to hold a summit since 2011, indicating its diminished activity and influence.
- On the other hand, BRICS has continued to hold summits regularly, with 14 summits taking place in the past 13 years.
- This contrast in the number of summits held by each group demonstrates the relative success and durability of BRICS compared to IBSA.
Focus of BRICS:
- Geopolitical:
  - Geopolitically, BRICS aimed to present a non-western perspective by articulating a common view on global and regional issues.
  - This collective stance projected an alternative to Western dominance and contributed to the march towards multipolarity, where power is distributed among multiple global actors rather than being concentrated in the West.
- Economic:
  - Economically, BRICS initiated various significant initiatives.
  - The New Development Bank, for instance, committed $32.8 billion to fund 96 projects, aiming to promote infrastructure development and sustainable growth.
  - The Contingent Reserve Arrangement (CRA) was established as a financial mechanism to safeguard against global liquidity pressures.
  - Additionally, BRICS pursued an extensive program to enhance trade and investment cooperation among its member countries.
Pitfalls:
- Diplomatic Deficiency:
  - There are negative tendencies that emerged within BRICS.
  - The IBSA trio (India, Brazil, South Africa) expected full support from China and Russia in their bid for membership in the UN Security Council, but they were disappointed.
  - Russia and China have been criticized for their frozen and patronizing formulation which merely supports the aspiration of Brazil, India, and South Africa to play a greater role in the UN.
  - This perceived lack of concrete support suggests a diplomatic deficiency within the BRICS grouping.
- China’s Disruptive Policies:
  - The BRICS (Brazil, Russia, India, China, and South Africa) grouping faced a number of challenges during the second decade of the century, particularly related to China’s economic rise and military assertiveness.
  - During this period, China experienced a significant economic growth, becoming a major global player.
  - However, its growing assertiveness in both economic and military matters created disturbances within the BRICS group.
  - This suggests that China’s actions and policies disrupted the balance within the group.
  - The consolidation of cooperation between Russia and China following the Ukraine conflict, where both countries strengthened their ties, further impacted the dynamics within BRICS.
  - Additionally, economic difficulties in South Africa increased its dependence on China, potentially creating imbalances within the group.
  - Brazil also underwent a period of political change, with a shift towards rightist policies, followed by the return of former President Lula da Silva.
  - These political transitions in Brazil could have introduced new tensions within the BRICS grouping.
  - Furthermore, Beijing’s proposal for a common currency for intra-BRICS trade is seen as a symptom of the inner troubles within the group. This suggests that there might be disagreements or divergent interests among the BRICS members regarding such initiatives.
Admission of New Countries into BRICS:
- Currently, 19 countries are expressing their eagerness to join BRICS.
- The regional breakdown of these countries includes four from Latin America (Argentina, Nicaragua, Mexico, and Uruguay), five from Africa (Nigeria, Algeria, Egypt, Senegal, and Morocco), and ten from Asia (Saudi Arabia, United Arab Emirates, Turkey, Syria, Iran, Afghanistan, Indonesia, Thailand, Kazakhstan, and Bangladesh).
Reasons for their Interests:
- Firstly, China is seen as pushing for expansion as a strategic move to extend its global influence.
- Secondly, countries may have a fear of missing out (FOMO) on being part of a visible and influential club like BRICS.
- Thirdly, many countries may perceive that other groupings have closed doors for them, making BRICS an attractive option.
- Lastly, there is a prevailing sentiment of anti-Westernism and a desire to create a significant forum of countries from the Global South.
Upcoming BRICS Summit:
- The upcoming BRICS summit, to be hosted by South Africa, is expected to discuss expansion and its criteria.
- It would present three options:
  - a mega expansion increasing membership to 21
  - limited admission of 10 new members with the support of existing members, or
  - admission of only five new members with the support of existing members and without the use of vetoes.
- The third option, with India’s support, seems to be the most likely scenario, with Argentina, Egypt, Indonesia, UAE, and Bangladesh identified as potential candidates.

Beyond the Editorial

Significance of BRICS for India: BRICS holds several significant opportunities for India, which contribute to its foreign policy objectives and economic interests:

Economic and trade opportunities: BRICS provides a platform for India to explore economic and trade opportunities within the member countries, particularly in key markets like China. Despite existing security tensions, China remains an important commercial partner for India. Intra-BRICS trade, although currently modest, offers prospects for growth and deeper engagement.
Managing relations with China: BRICS and other groupings like the Shanghai Cooperation Organization (SCO) allow India and China to compartmentalize their strategic contest while maintaining cooperation in other areas. This provides a platform for dialogue and collaboration on shared interests, decoupling strategic tensions from other dimensions of their relationship.
Multi-aligned foreign policy: Participation in BRICS helps India balance its growing partnerships with the West. By engaging with non-Western groupings like BRICS, India demonstrates its commitment to strategic autonomy and a multi-aligned foreign policy. This allows India to maintain its own interests while engaging with both Western and non-Western actors.
Quest for international status: Membership in BRICS elevates India’s global profile and presents an opportunity to project itself as a truly international player. Being a part of BRICS provides India with a platform to engage with other major emerging economies and contribute to global decision-making processes. It enhances India’s visibility and influence on the international stage.

India’s contributions to BRICS:

India played a significant role in proposing the establishment of the New Development Bank (NDB) in 2012.
- The NDB aims to provide funding for infrastructure and sustainable development projects within BRICS and other emerging economies.
India also introduced the Urbanization Forum to focus on cooperation among BRICS members in addressing challenges related to rapid urbanization.
Additionally, India institutionalized the practice of hosting BRICS Academic Forum meetings, which contribute to shaping the summit agenda by gathering insights and expertise from academia.