INDIA- BRICS – INTERNATIONAL
News: The paradox of BRICS, its new pathway
What is in the news?
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BRICS may have lost much
of its sparkle in the lines of SAARC, but a long queue of nations awaits
membership.
Importance of BRICS to India:
1. Economic Cooperation:
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The BRICS countries
represent a substantial share of the global economy and have immense potential
for economic cooperation. India can take benefits from trade and investment
opportunities within the group.
2. Geopolitical Influence:
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The BRICS serves as a
platform for India to strengthen its geopolitical influence on the global stage.
3. Development Financing:
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The BRICS countries have
established institutions like the New Development Bank (NDB) and the Contingent
Reserve Arrangement (CRA).
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These institutions
provide alternative sources of financing for infrastructure projects and development
initiatives in India.
4. Multilateralism and Reform:
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The BRICS advocates for a
more equitable and inclusive global order. As a member, India actively
participates in discussions and initiatives aimed at reforming international
institutions like the United Nations, World Trade Organization.
5. Forum to balance bilateral relations:
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BRICS can be a forum for
India to neutralize its recent warming relations with the Western countries.
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Through this forum India
can actively engage with Russia and China.
Challenges for BRICS to lose its importance:
1. Economic Divergence:
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One of the primary
challenges for the BRICS is the economic divergence among its member countries.
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While China has emerged
as a global economic powerhouse, other BRICS nations, including India, Brazil,
Russia, and South Africa, face varying degrees of economic challenges such as
slow growth, structural issues, and political instability.
2. Geopolitical Differences:
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The BRICS nations have
different geopolitical interests and priorities. They often have divergent
views on global issues, regional conflicts, and strategic alliances.
3. Internal Governance Issues:
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Each BRICS nation faces
unique internal governance challenges like Corruption, political instability.
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These internal issues can
impact the credibility of the BRICS as a collective entity and undermine its
ability to deliver on its objectives.
4. Competition and Rivalries:
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Despite being part of the
same grouping, BRICS nations often compete with each other in areas such as
trade, investment, and geopolitical influence.
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E.g. India and China.
5. Lack of Institutionalization:
● The BRICS is a relatively informal grouping without a formal institutional framework or permanent secretariat. The absence of a formal structure can make decision-making and coordination more challenging.
WAY FORWARD:
1. Inclusion of more members:
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BRICS should provide
membership to other like minded countries to diversify its presence and enhance
its influence.
2. Strengthening Institutional Framework:
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Establishing a more
robust institutional framework can enhance the effectiveness of the BRICS.
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Eg. BRICS
framework, Long term agenda etc.
3. Addressing Economic Disparities:
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The BRICS should actively
address the economic disparities among its member countries.
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Eg. Collaboration on development projects, infrastructure investments, and
technology transfers can help bridge the economic gaps.
4. Enhanced Economic Cooperation:
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Strengthening economic
cooperation among BRICS nations should be a priority.
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This can be achieved
through the promotion of intra-BRICS trade and investment, reducing trade
barriers, and exploring new areas of economic collaboration.
5. Deepening People-to-People Connections:
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People-to-people
connections play a vital role in fostering stronger ties among BRICS nations.
Go back to basics:
BRICS:
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BRICS is an acronym for
the grouping of the world’s leading emerging economies, namely Brazil, Russia,
India, China, and South Africa.
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In 2001, the British
Economist Jim O’Neill coined the term BRIC to describe the four emerging
economies of Brazil, Russia, India, and China.
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South Africa was invited
to join BRIC in December 2010, after which the group adopted the acronym BRICS.
Share in the world:
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41% of the world
population,
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having 24% of the world
GDP and
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over 16% share in world
trade.
Presidency:
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The chairmanship of the
forum is rotated annually among the members, in accordance with the acronym
B-R-I-C-S.
Pillars:
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political and security,
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economic and financial
and
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cultural and
people-to-people exchanges.
Initiatives:
1. New Development Bank (NDB):
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The prospect of
establishing a new Development Bank was discussed at the Fourth BRICS Summit in
New Delhi (2012) to mobilize resources for infrastructure and sustainable
development projects in BRICS and other emerging economies, as well as in
developing nations.
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Its headquarters is
located in Shanghai.
2. Johannesburg Declaration:
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Launched in 2018.
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Major provisions are
Mutual respect, sovereign equality, democracy, inclusion, and greater
partnership were all reiterated by the leaders.
3. BRICS Payment System:
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BRICS countries are
trying to create a payment system as an alternative to the SWIFT payment
system.
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This has taken on a new
urgency as post Ukraine war, Russia has been frozen out of SWIFT.