BRICS beckons

BRICS beckons

The substantive idea of a BRICS bank with a  priority for infrastructure lending was first mooted at the Delhi summit.

On Sunday, prime minister Narendra Modi will embark on a long journey across the Atlantic. No, he is not headed to America; that will come later in September for attending the UN General Assembly and for a meeting with Obama. He now travels to Fortaleza, a city, in the north-eastern corner of Brazil for the BRICS summit on July 15.

Any mention of Brazil and our thoughts turn only to one subject—the football frenzy that we are witnessing all over the world with the FIFA world cup. Two days before the summit is the finals and it is a safe bet that PM will reach a country recovering from football hangover.  As the country has  failed to reach the finals, with a humiliating defeat by Germany in the semis, it will be in a state of disappointment, if not despair. Why organise an important summit almost coinciding with the once in four years world cup? It is more by design than accident. 

It is understood that the Chinese President Xi Jiping, a self confessed soccer fan wanted to see the finals and his wish was accommodated in scheduling the summit. The fact that India was to have a new prime minister only in May and that the Brazilian president herself is going for re-election in October gave a very narrow window of possible dates for the organisers. Hence the date. Be that as it may, what can we expect from BRICS and PM’s visit to Brazil?

It must be recognised that the most important aspect for PM will be his one on one meetings with key world leaders: Xi Jinping, Putin, Zuma, and  the host, Dilma Roussef.  His getting to meet them for the first time on the margins of the multilateral meeting is a significant outcome particularly as the small club like ambience of BRICS is  suitable for this purpose.     

By now, BRICS is internationally well established, but still continues to evoke questions about its identity. Its members (Brazil, Russia, India, China and South Africa) span three continents and adhere to different political systems. Two are permanent members of the Security Council while India and Brazil are claimants. Two are acknowledged nuclear weapon states, India a declared one, and Brazil and South Africa self-professed abnegators. Despite such differences in political outlook, regional affiliations and strategic concerns,  what holds them together?

 The answer, a decade ago when the acronym was floated, lay in some of their striking economic features: high rate of economic growth at a time when the western economies were stagnant; growing share in global GDP; comfortable foreign exchange reserves; and their weight in objective terms, be it, population, area, and above all as markets. In  2009, the first BRIC summit ( without South Africa) was held in Russia when their economies were  buoyant.

Discussion on growth

Six years later, as the summit takes place in Brazil, the international situation has changed. Some of the economic features that gave the BRICS countries an enviable profile have changed and in particular India, Brazil and South Africa have been growing at a more modest rate. ( China continues to outperform every other nation in the world ). BRICS as a forum has had some modest achievements -– a networking of academics and research institutions, an acceptance in principle of its demand for greater say in international financial institutions, and identification of  priorities for cooperation in some sectors. 

In this framework, what is envisaged at the summit in Brazil? As the theme for discussions, Brazil  has proposed ‘inclusive growth and sustainable solutions.’ The relevance of the distributive aspects of growth – as and when it gathers momentum, focus on the environment and a model of development that is planet-friendly, is unexceptionable. Brazil had hosted the Rio+20 meet in 2012 and thus seeks to highlight the ‘sustainable development strategies’  that have emerged. The substantive idea of a BRICS bank with a  priority for the much needed infrastructure lending was first mooted at the Delhi summit. Decisions now need to be taken on institutional issues such as the venue, the leadership and the voting pattern. It will be a breakthrough if with a final push, the Bank is agreed upon at the forthcoming summit. 

The  leaders will also have to come to terms with significant political events of the day as they have done in the past. Two issues are contentious. Russia may seek an endorsement of its position on Ukraine, but other countries will be a bit guarded as there are difficult issues of secession, self-determination and  external interference that underlie this conflict. The other complex issue relates to cyber governance and how to regulate the internet in the post –NSA/Snowden age. All BRICS countries have been targeted by covert surveillance by the US  and whether they can evolve common and credible positions, will be watched with interest.

The visit to Brazil should be interesting for another reason. In the comity of nations, the similarities between India and Brazil are truly extraordinary, given that India with its size and stage of development has few countries to compare itself with. Brazil, is two and a half times the size of India, has a large population (nearly 200 million), is decidedly a developing country with problems of poverty, education, health and income disparity. 

It is also a noisy and demanding democracy as we see in the vociferous street protests even amidst the celebration of the world cup. In the last twenty years, Brazil has made significant strides in lessening income and regional disparities by innovative programmes and efficiently delivered systems. All this should be of interest to us apart from the potential for enhanced economic cooperation in food, minerals and energy, which Brazil has in plenty. 

Both with regard to Brazil and BRICS, how to convert good intentions to concrete results should be the focus of  this visit in keeping with the expectations from the style of the Modi government.

(The writer is a former ambassador to Brazil and is currently a visiting professor at the Jamia Milia University)

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