What is BRICS?
• BRICS is the acronym for an association of five major emerging national economies: Brazil, Russia, India, China and South Africa.
• BRIC started as a formal grouping in 2006 on the margins of G8 outreach summit.
• Since 2009, the BRICS nations have met annually at formal summits. 8th summit in 2016 was held in Goa and BIMSTEC countries were invited for a joint summit as per the tradition. 9th summit in 2017 was held in China and the upcoming 10th summit will be held in South Africa
FEATURES OF BRICS:
• Represents 3 Billion People. (40% of World Population)
• Accounts for $20 Trillion of GDP which is growing at 28% Growth Rate.
• First Summit in 2009, in the midst of Global Recession.
• No European/US as a member.
• Idea to form this group was conceived by Goldman Sachs.
MAJOR ISSUES AND CONCERNS FACED BY BRICS:
• Trade and investment
• Infrastructure and industrial development
• Food Security
• Research and development
• Cultural exchange and tourism
What is the Significance of BRICS?
• BRICS cooperation has two pillars – consultation on issues of mutual interest through meetings of Leaders as well as of Ministers of Finance, Trade, Health, S&T, Education, Agriculture, Communication, Labor, etc.
• Focused on “greater people-to-people participation” during the BRICS events like BRICS Film Festival, BRICS Wellness Forum, BRICS Youth Forum and BRICS Friendship Cities Conclave held throughout the year across the country.
• The New Development Bank (NDB) and the Contingent Reserve Arrangement (CRA) are the financial mechanism under BRICS.
• CRA proposes to provide short-term liquidity support to the members through currency swaps to help mitigating BOP crisis situation, if such a situation arises.
• It would also contribute to strengthening the global financial safety net and complement existing international arrangements (from IMF) as an additional line of defense.
• BRICS Credit Rating Agency may come in near future to challenge the monopoly of the West
• In the current global political and economic scenario where protectionism and patriotism is on the rise, BRICS can become the bulwark of new globalization and may create new world order driven by emerging economies.
Highlights of the 8th BRICS Summit: GOA INDIA in 2016
• Theme: “Building Responsive, Inclusive and Collective Solutions.”
• Adoption of “Goa Declaration” a document of 27 pages and 110 pointers.
• BRICS: Encompasses 43% of the world population, 30% of the world GDP and 17% share in the world trade.
• 5 pronged approaches I4C:
Institution building to further deepen institutionalize BRICS cooperation;
Implementation of the decisions from previous Summits;
Integrating the existing cooperation mechanisms;
Innovation, i.e., new cooperation mechanisms, and
Continuity, i.e., continuation of mutually agreed existing BRICS cooperation mechanisms.
Major Outcomes of the BRICS Goa Summit
• Reiterated determination to use all policy tools to achieve the goal of sustainable and inclusive growth.
BRICS called for tackling terrorism, early adoption of CCIT
• Called upon all nations to adopt a comprehensive approach in combating terrorism, violent extremism, radicalization, and recruitment, movement of terrorists including foreign terrorists and blocking sources of financing terrorism.
• It further called upon for the early adoption of CCIT (Comprehensive Convention on International Terrorism) in the UN General Assembly without any further delay.
• It also appreciated the Paris Climate Agreement and its imminent entry into force on 4 November.
• India is one among the many countries that is worried about the weakening of international institutions and the tendency to impose unilateral preferences over others.
• BRICS called for urgent need to reforms of the United Nations, including UN Security Council, to increase representation of developing countries.
Reaffirmed commitment to the FATF (Financial Action Task Force)
• Reaffirmed commitment to the FATF (Financial Action Task Force) and swift, effective and universal implementation of FATF on combating terrorist financing, including effective implementation of its operational plan.
India’s Role in BRICS:
India since the inception of BRICS has played an important and active role.
It attaches high importance to the BRICS forum for promoting global economic growth, peace and stability.
Co-operation on the economic front is one of the focus areas of India’s policy towards BRIC. India sees BRICS as a platform to build multilateral relations with Latin American, African and Asian countries. India has also played an important role in the setting up of New Development Bank. Also for India, co-operation with the BRICs is very important in terms of addressing its food and energy security issues, and combating terrorism.
What can we expect by 2025?
The BRICS will significantly increase their share in the world economy and trade. A new global financial system with a significant presence of these countries, compared with the current situation, will be created.