The Hindu Editorial Analysis- 24th May 2023 | Current Affairs & Hindu Analysis: Daily, Weekly & Monthly - UPSC PDF Download

Why in News?

Mysterious are the ways in which multilateral groupings prosper and wither away. The Non-Aligned Movement (NAM) and G-77 had their heyday in the Cold War era. Later they lost their relevance, but they still exist. The South Asian Association for Regional Cooperation (SAARC) summits ended in 2014, but the Secretariat somehow keeps itself busy. Despite serious policy divergences on China and Myanmar, the Association of Southeast Asian Nations (ASEAN) continues to function, consuming reams of paper to issue long communiqués.

What is BRICS?

• The acronym BRICS stands for Brazil, Russia, India, China, and South Africa, a grouping of the world's emerging economies.
• Jim O'Neill, then-chairman of Goldman Sachs Asset Management, is thought to have originated the word "BRIC" in his 2001 publication Building Better Global Economic BRICs. Roopa Purushothaman, a Research Assistant in the original paper, was the one who created the phrase.
• BRICS does not exist as an organization. Rather it is an annual summit between the leaders of the included countries.
• In 2009, the Russian Federation hosted the first BRIC Summit, which focused on themes such as global financial architecture reform.

Members

• In December 2010, South Africa was asked to join BRIC, and the group's acronym was changed to BRICS. In March 2011, South Africa attended the Third BRICS Summit in Sanya, China.
• According to the formula B-R-I-C-S, the chairmanship of the forum is rotated annually among the members.
• The significance of the BRICS is self-evident: they account for 42% of the global population, 30% of land area, 24% of global GDP, and 16% of international trade.
• The G-20 includes the five BRICS countries.

Objectives

• For more sustainable, equitable, and mutually beneficial development, the BRICS aspire to deepen, broaden, and accelerate collaboration within the grouping and among individual nations.
• To guarantee that interactions are established on the respective country's economic strengths and to prevent rivalry whenever possible, BRICS takes into account each member's growth, development, and poverty objectives.
• BRICS is establishing itself as a new and promising political-diplomatic body with a wide range of goals that extend far beyond the basic goal of overhauling global financial institutions.

BRICS' major accomplishments

• Johannesburg Declaration
  • The BRICS presidents met in Johannesburg in 2018 to discuss a variety of international and regional issues of shared concern, and the 'Johannesburg Declaration' was unanimously accepted.
  • Mutual respect, sovereign equality, democracy, inclusion, and greater partnership were all reiterated by the leaders.
• New Development Bank (NDB) projects
  • The prospect of establishing a new Development Bank was discussed at the Fourth BRICS Summit in New Delhi(2012) to mobilise resources for infrastructure and sustainable development projects in BRICS and other emerging economies, as well as in developing nations.
  • Its headquarters is located in Shanghai.
  • The presidents signed the Agreement establishing the New Development Bank during the Sixth BRICS Summit in Fortaleza, Brazil, in 2014.
• Local Currency Bond Fund
  • The BRICS nations are planning to establish a Local Currency Bond Fund after a successful Contingent Reserve Arrangement.
• Business Promotion
  • The BRICS Business Council held a meaningful discussion to promote collaboration in areas such as infrastructure and energy, as well as financial services, regional aviation, and the digital economy.
  • A BRICS Women Business Alliance was also established, both as a measure of women empowerment and as a mechanism to convey "a unique perspective on problems of concern to the business community."

Relevance of BRICS for India.

• India may benefit from the BRICS combined strength by consulting and cooperating on economic matters of mutual concern, as well as current global issues like international terrorism, climate change, food and energy security, global governance reforms and so on.
• The NDB will assist India in raising and obtaining money for infrastructure and long-term development initiatives.
• The NDB has authorised its first series of loans, including a $250 million credit to India under the Multitranche Financing Facility for Renewable Energy Financing Scheme.

Challenges

• The BRICS have a hurdle as it moves forward because of the dominance of the big three countries of Russia, China, and India. BRICS must become pan-continental in order to truly represent huge emerging markets around the world. Its membership should include more countries from different continents and areas.
• For the BRICS to become more relevant in the global system, they will need to broaden their agenda. Climate change and infrastructure development finance are currently at the top of the agenda.
• As the five-member countries pursue their own national agendas, BRICS' core ideals, such as respect for sovereign equality and pluralism in global governance, are likely to be put to the test.
• The military standoff between India and China on the Doklam plateau has effectively put an end to the foolish concept that a peaceful political relationship between the BRICS countries is always feasible.
• China's aspirations to integrate nation-states, which are central to its Belt and Road Initiative, into a bigger political system could lead to tension among BRICS members, particularly between China and India.

Conclusion

In its first decade, BRICS did a good job of identifying issues of shared interest and creating channels to address them. In order for BRICS to remain relevant over the next decade, each of its members must examine the initiative's opportunities and constraints realistically.