New Delhi BRICS Summit: New Prospects, But More Challenges?

New Delhi is currently in the limelight in view of the forthcoming fourth BRICS summit scheduled for 28-29 March. This is the second BRICS summit being held consecutively in Asia, after the summit held in Sanya (China) last year. India is the second-largest economy in BRICS, after China. With the New Delhi summit, the BRICS spectrum, combining the world’s emerging economies across diverse continents to discuss global governance issues and collective multilateral issues, will get more institutionalised. The summit will also be the first where South Africa will participate as a full member, after its official entry to the BRICS grouping during the Sanya summit. The New Delhi summit is taking place when the US and many parts of Europe are still reeling under a financial crisis.

The success of the Sanya summit was mainly counted on three fronts: South Africa’s inclusion into the grouping for which the Chinese lobbied hard, united support for Russia’s entry into the WTO, and the release of the first BRICS Joint Declaration. The New Delhi summit is expected to carry forward some of the issues and directives from the Sanya declaration. But the real success of the summit will depend on how and to what extent it achieves those declared objectives, implement or actualise them. The summit is definitely a way forward in institutionalising the BRICS momentum. It will be the fourth successive time when the top leaders from the emerging economies meet at a regular interval. It not only indicates that the world has sufficiently become multipolar in nature, but also explains that emerging economies are slowly rising as an important political grouping on common multilateral issues.

BRICS as a unit has always gathered sufficient media attention. This is mostly because BRICS members together not only constitute almost half of the world population but also represent different continents across the globe. Their fast rising economies have been the impressive factor behind their political pre-eminence. From the Western perspective, BRICS is a unique story as there is no representation from North America, and this group has always asked for greater transparency in global financial bodies like the IMF, World Bank and the WTO and pressurising the Americans and the Europeans to concede their overriding powers in these bodies. BRICS is also an association of emerging economies, which unites Asia’s two adversarial powers – China and India – which may not entirely be to the liking of the West.

The Sanya summit was highlighted politically because it was held in China; and China is not only the largest economy of the grouping, but also the number two economy of the world. Given China’s troubled relations with the West on financial and political matters, many tried to read the Sanya declaration through the Chinese prism. Under the theme of “Broad Vision, Shared Prosperity”, the Sanya summit did discuss several global economic and political issues. The Joint Declaration not only mentioned cooperation on global economic issues but also noted pressing political and security issues like Libya, terrorism, UNSC reform, nuclear energy, food security, climate change, the role of the G-20, etc. The declaration also emphasised upon reforming the IMF, urged an “international reserve currency system”, and asked for more SDRs for the developing economies.

The New Delhi summit may discuss at length some of these issues. Although these issues have constantly been raised at previous BRICS summits, not much action has been taken collectively by BRICS members about these issues on account of lack of consensus. There will again be a test of character for BRICS in New Delhi, regarding the extent to which these previously discussed issues will be addressed and implemented. The real challenges for the New Delhi summit are issues that are linked not only with the future of BRICS but also with the conduct and approach of its members towards each other. These include: a decision on inducting new members, establishing a BRICS Development Bank, establishing a permanent headquarter for BRICS, and developing consensus on UNSC reform, particularly on the permanent membership issue, and addressing some of the global political issues like Syria, Iran and probably North Korea.

There are no uniform guidelines for membership induction in BRICS currently, as the group is still in an embryonic stage. Rapidly rising market economies like Colombia, Indonesia, Vietnam, Egypt and Turkey (jointly known as CIVET) are frontline candidates for BRICS membership. In many indicators, Indonesia is on the forefront, and both China and India share healthy economic relations with that country. With some 240 million people, it is the fourth populous country in the world, with a huge Muslim population. Indonesia is known currently as an attractive investment destination worldwide. Though Indonesia could be considered for BRICS membership, the New Delhi summit must seriously consider the wisdom of extending BRICS membership. While inducting new members could add strength and vigour to the grouping, as it will strengthen the voice of the emerging economies in the world, it could also weaken the momentum of BRICS, since consensus on key economic and strategic issues will become more difficult to elicit. China succeeded in inducting South Africa into BRICS, though the South African economy was not objectively attractive enough for BRICS membership. By inducting South Africa, China attained its objective of creating cross-continental networks with the bloc in Africa, sidelining India’s pre-eminence in IBSA where India is linked with Brazil and South Africa on a separate spectrum. This kind of agenda setting needs to be avoided if BRICS is to remain healthy as a future institution. The New Delhi summit could think of preparing new guidelines for inducting new members.

Setting guidelines also makes sense particularly when the experts from BRICS are talking about setting up a BRICS Development Bank and headquarter. The recently concluded 4th BRICS Academic Forum in New Delhi indicated the creation of “financial institutions” through the establishment of a Development Bank and Investment Fund. This issue may well be discussed at length in New Delhi. Earlier, India had proposed establishing a multilateral bank that would be exclusively funded by developing countries, and look after the economic and developmental issues among the BRICS nations. Reports indicate that this proposal has been supported by Brazil, Russia and South Africa, whereas the Chinese seem to have some difference of opinion with India on the structure and functioning of such institutions. While every BRICS member can have its own Development Bank, the important issue will be: which country will have the main branch or the head office. The New Delhi summit could discuss and generate consensus on this issue. Establishing a headquarter for BRICS is another issue that invites greater discussion and consensus among its members. Other issues like the appointment procedure of the head of the BRICS Development Bank and the rotation policy of the BRICS Presidency, if the headquarter is established, also merit greater debate.

There are greater global political issues on which the BRICS members must talk and build consensus. UNSC reform is one such issue. While India is a potential candidate for UNSC permanent membership, the Chinese are reluctant to openly support India’s candidature. They have exclusively asked for greater representation for South Africa in the UNSC on different occasions, and advocated South Africa’s entry into the UNSC as a permanent member representing the African continent. Brazil’s interest in UNSC permanent membership is not backed by the Russians. There is scope for the New Delhi BRICS summit to raise the issue of UNSC reform and build consensus. Both China and Russia should be categorical and forthcoming on UNSC reform, as that will not only strengthen the BRICS momentum but will also help it to face and challenge most of the global multilateral issues collectively, at least on an equal footing. It may be recalled that the Sanya summit did comment about the “multilateral diplomacy with the United Nations playing the central role”, and reforming the “UN, including its Security Council”.

Syria is another issue that invites greater consultation among BRICS members. During the recent UN voting, while India supported the UN resolution urging the Syrian President to step down, both China and Russia opposed it. Some of these global political issues need greater consensus and understanding among BRICS members. BRICS is still at the conceptual stage, and lacks consensus and greater consultation among its core members. It is the size, power and the growing global influence of members like China and India that have made it more attractive. Coordinating policy at the level of BRICS will not be easy, given that the political interests of BRICS members clash at various levels. Still, this group could be a catalyst for resolving many pressing global political problems. The New Delhi summit is certainly an important summit in this context.

Dr. Jagannath Panda is Research Fellow at IDSA in New Delhi, and Currently a Carole Weinstein programme visiting faculty at the Dept. of Political Science, University of Richmond in Virginia, USA