Is the idea of BRICS relevant anymore?

On Sep. 9, 2021, the leaders of the BRICS (Brazil, Russia, India, China, and South Africa) held their 13th summit meeting.

A few years ago, these BRICS summits used to be a global talking point, were noted, discussed, and analysed by the media worldwide, and were being seen as an alternative economic power bloc threatening anytime soon to replace the Post-war liberal world order.

However, the hype over the BRICS has disappeared so fast in recent years that this year’s summit meeting failed to get media attention even in the member countries.

Jim O’Neill first conceived the idea of this group in 2001, the then Chairman of Goldman Sachs Asset Management. In 2006, the concept, with an eye-catching acronym, turned into reality when the four emerging economies of that time, Brazil, China, India, and Russia, met informally in July 2006 at the margins of the G-8 Outreach Summit in St. Petersburg.

Soon after, their foreign ministers formalised it in their meeting in September 2006 on the sidelines of the General Debate of UN General Assembly in New York.

Despite scepticism about their geographical distance, political, cultural, and ideological differences, the leaders of the four economically emerging nations started meeting annually since holding their first summit in Yekaterinburg, Russia, on June 16, 2009. Four-nation BRIC became a five-nation BRICS in 2011 after South Africa joined the group.

Dominating global security architecture?

In its first five years of existence, BRICS was seen to replace G-7’s domination of the Bretton Wood Institutions and dominate global security architecture. Hope was on its side.

The five BRICS countries host more than 40 per cent of the global population, one-third of world’s land area, and one-fourth of the world GDP. They all have enormous potential for economic growth, own abundant natural resources, and constitute huge domestic markets.

In a dozen years of its existence, the BRICS has established Shanghai-based New Development Bank and formed BRICS Business Council, BRICS Business Forum, and BRICS Contingent Reserve Arrangement.

Though China has been the real anchor of this group from its inception, in all practical purposes, the China-India partnership was used to be the crux of its allure. But, that dream of the Asian Century with combined strength and power of the two most populous countries of the continent has almost disappeared due to the fast widening power disparity between them.

China has already become a major global powerhouse, and its economy is poised to overtake the US by 2028 as the world’s largest economy. Despite the pandemic, China’s strength and influence grew exponentially economically and militarily, and politically. China and Russia have also made some sort of strategic alliance to checkmate the domination of the US and its European allies in the global power table.

While China is surging ahead economically, other countries in the group have fallen far behind. China’s total GDP is more than double the combined GDPs of the other four countries in the group. The economic growth stories in Brazil, South Africa, and Russia have come to a halt for some time now.

Powerful economic grouping

Goldman Sachs, which was first to float the idea of this club, wound up its BRICS investment fund in 2015, after the loss of almost 88 per cent of its asset value from the 2010 price. The growing economic crisis in India since 2016, and the devastating Covid-19 pandemic making it much worse, have ended any hope of BRICS becoming a powerful economic grouping in the world.

Though economics had mooted the origin of the BRICS, politics is paving the path towards its virtual demise. Coinciding with its economic downturn, India’s relations with China have deteriorated since 2016. India’s decision to sign Logistic Exchange Memorandum Agreement (LEMOA) with the US in April 2016 and boycott the China’s Belt Road Initiative since May 2017 put their bilateral relationship in reverse gear.

As if the two-week long, tense border standoff at Doklam between the Indian Armed Forces and People’s Liberation Army of China in 2017 was not bad enough, both the armies came into a violent face off in 2020 in Ladakh. Even after more than a year, both accuse each other of intruding into each other’s territory.

India has banned some Chinese apps, and often there are political calls for boycotting Chinese goods. India’s enthusiastic participation in the US-led Quad has brought an end to any hope of improving its relations with China anytime soon.

For all practical purposes, the BRICS, due to intragroup political rivalry, has ceased to be a group of taking any consequential cooperative undertaking. It has become too heterogeneous politically to align its economic and strategic interests.

The BRICS may continue to exist, like many other multilateral platforms. The periodic meetings of leaders and ministers help some countries to maintain a working relationship despite their political and strategic tensions with China, as the growing economic interdependence demands it.

But the hope of BRICS providing an alternative global order has already come to an end. It has become just another decorative forum in a multipolar world.