The BRICS alliance—originally composed of Brazil, Russia, India, China, and later South Africa—has become one of the most prominent groups of emerging economies, holding significant sway in global geopolitics and economic affairs. First established informally in 2006 during a meeting on the sidelines of the G8 Outreach Summit, the bloc formally added South Africa in 2010. With each member nation representing a distinct geographical and economic influence, BRICS continues to engage with new and emerging markets, furthering cooperation in diverse areas from economic policy to environmental initiatives.

In 2024, four new countries—Egypt, Ethiopia, Iran, and the UAE—were added to BRICS, with Saudi Arabia yet to formalize its membership despite participating actively. Together, the alliance now represents 45% of the global population and controls 30% of the world’s GDP. Recent BRICS summits, including the 16th BRICS Summit held in Kazan, Russia, underscore the alliance’s growing reach and focus on multilateralism. The Kazan Summit, in particular, addressed issues of global South development, counter-terrorism, economic stability, and sustainable development.

 

 

Recent Highlights from the 16th BRICS Summit

The summit showcased notable decisions, particularly in light of new member participation, and reaffirmed BRICS’ commitment to expanding its influence and diversity. Discussions among leaders centered on the necessity of multilateral cooperation and financial integration to counter unilateral economic pressures and create a more balanced global economic system. During this summit:

  • Leaders endorsed financial integration efforts, emphasizing the use of local currencies for trade and supporting the concept of a BRICS-led payment system to rival SWIFT.
  • India’s UPI (Unified Payments Interface) model was highlighted as an efficient example for digital cross-border payments.
  • Talks also touched on the BRICS Grain Exchange, a proposed grain trading platform within BRICS to strengthen food security.

The Kazan Declaration expressed the alliance’s collective stance on various geopolitical issues, advocating peaceful resolution through dialogue and diplomacy for the Ukraine conflict and condemning human rights violations in West Asia. Concerns were also raised over Western sanctions and their destabilizing impacts on global trade and the pursuit of UN Sustainable Development Goals (SDGs).

India-China Bilateral Meeting

The summit included a significant meeting between India and China, marking the first bilateral engagement since the 2020 border dispute. Both countries agreed on the terms of disengagement along the Line of Actual Control (LAC), allowing troop patrols at previously contested points in the Depsang Plains and Demchok. This development signals a potential reset in India-China relations, aiming for cooperation over contention.

Structure and Purpose of BRICS

BRICS serves as a unique coalition of emerging economies committed to fostering economic and political cooperation. Initially focused on harnessing investment opportunities, BRICS evolved into a geopolitical bloc by 2009, with countries holding annual summits to align on multilateral issues. The New Development Bank (NDB), established during the 6th BRICS Summit in Fortaleza (2014), has funded projects worth USD 30 billion since its inception. Despite criticisms over economic disparities within the group, BRICS has maintained steady collaboration through institutional mechanisms like the Contingent Reserve Arrangement (CRA), designed to provide financial security during global liquidity pressures.

With the addition of new members in 2024, the bloc now comprises ten countries. These economies together control 44% of the world’s crude oil production and contribute significantly to global food and energy security. The alliance is also committed to fostering a multipolar world order, where Global South countries can challenge Western hegemony and advocate for better representation in institutions like the United Nations Security Council (UNSC), IMF, and World Bank.

Key Financial Mechanisms and Initiatives

  • New Development Bank (NDB): Based in Shanghai, the NDB was established to fund infrastructure projects across BRICS countries, with a lending capacity of $34 billion annually. South Africa hosts the NDB’s African regional headquarters. As of 2021, Egypt, the UAE, Bangladesh, and Uruguay joined as partner countries.
  • Contingent Reserve Arrangement (CRA): Created as a backup mechanism against financial instabilities, the CRA has a $100 billion lending capacity to support members during currency or liquidity crises, challenging the IMF’s role.
  • BRICS Payment System: Proposed as an alternative to SWIFT, this system aims to enable secure transactions within the alliance in national currencies to avoid dependency on dollar-based systems.

Influence and Challenges

BRICS has emerged as a cohesive institution despite internal economic disparities and geopolitical contradictions. Though economic power is heavily weighted towards China, India, and Russia, BRICS has proven capable of fostering collaboration on global issues like climate change, energy security, and anti-terrorism measures. Critics have raised concerns that the economic and political diversity of members could hamper BRICS’ unity, especially with some countries maintaining alliances with the West. However, the bloc’s commitment to non-interference and equality among members has allowed it to maintain a unified front.

Despite ambitions to counterbalance the dollar and establish a multipolar financial system, BRICS faces significant hurdles. Its currency initiative and the NDB’s growth have been overshadowed by World Bank lending figures and the strength of the dollar in global transactions. Moreover, geopolitical conflicts among members and diverging economic interests could challenge consensus-driven decision-making, potentially leading to inefficiencies similar to those seen in other large alliances like NAM and G77.

Expansion and Future Objectives

BRICS’ recent expansion reflects its aspirations to become a more influential player on the world stage. Newer members like Iran, Saudi Arabia, and Ethiopia add diversity and regional influence. China’s ‘BRICS Plus’ concept has played a key role in driving expansion, with an emphasis on inclusivity for developing countries interested in the bloc. Through its expansion, BRICS aims to promote global South solidarity and advocate for reforms in international governance structures to give a greater voice to emerging economies.

To enhance its influence, BRICS is also exploring the possibility of a common currency to simplify trade among members, reducing dependency on the dollar and fostering economic resilience.

Environmental and Social Initiatives

BRICS has actively supported initiatives for biodiversity conservation and sustainable development. The alliance endorses efforts to protect big cats and conserve vulnerable species. India, in particular, has led the establishment of an International Big Cats Alliance, promoting collaboration among BRICS nations on wildlife conservation. The BRICS Grain Exchange proposal aims to strengthen food security by providing a stable platform for grain trading within the alliance.

Challenges Ahead

While BRICS has shown resilience and adaptability, its ambitions are tempered by internal contradictions and external pressures:

  • Geopolitical Rivalries: As a diverse bloc, BRICS must navigate internal contradictions—such as Egypt and the UAE’s alliances with the US and Iran’s adversarial position towards Western nations.
  • Consensus-Based Decision-Making: With expanding membership, reaching consensus may become increasingly complex, risking policy inefficiencies.
  • Economic Disparities: Significant differences in economic power among members could lead to an imbalanced agenda dominated by larger economies.

Looking Forward

To remain effective, BRICS should focus on:

  • Setting clear objectives that promote cooperation in trade, technology, and security.
  • Strengthening collaboration on supply chains, energy, food security, and financial resilience.
  • Upholding universal security by respecting all nations and encouraging dialogue over confrontation.

BRICS’ evolution from a purely economic grouping into a geopolitical bloc underscores its importance in a world where the balance of power is shifting. The bloc’s commitment to reform and multipolarity positions it as a significant force in reshaping the global economic and political landscape. With the combined might of its members and new additions, BRICS continues to challenge existing structures and advocate for the interests of the Global South on the global stage.

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