Can Brics rival the G7?
- 29 March 2012
- From the section India
Given the economic muscle they now enjoy, a meeting of leaders from Brazil, Russia, India, China and South Africa, which became part of Brics in April last year, automatically generates interest.
When Dilma Rousseff, Dmitry Medvedev, Manmohan Singh, Hu Jintao and Jacob Zuma gather for the fourth Brics summit in Delhi on 29 March, can they go beyond the statements of their past meetings?
"The G7 could have some serious competition in Brics," says Biswajit Dhar, director-general of the Research and Information System for Developing Countries, a Delhi-based think tank
"Like the G7, this new grouping meets voluntarily every year. Brics has put some serious issues on the table."
The past three summit meetings have seen the leaders of this "Economic Five" take hesitant, small steps in the direction of giving some teeth to an organisation that could guide and direct the economic power shift from West to East.
Last year, at their summit meeting in China, the Brics statement said that international financial institutions should "reflect the changes in the world economy, increase the voice and representation of emerging economies and developing countries".
Such statements have been heard before. In Yekaterinburg, Russia, the then-Bric statement in 2009 said: "We are committed to advance the reform of international financial institutions, so as to reflect changes in the world economy."
Not just the population of the Brics, but the rest of the world will be watching whether the Delhi meeting can lead to action on key global economic issues.
For instance, academics from Brics countries have suggested the creation of a development bank or an investment fund to boost co-operation among these five countries be taken up in Delhi.
Sudhir Vyas, a senior Indian official associated with summit preparations, said on Monday that the idea of a development bank had "been in the air for some time".
Going beyond statements will not be easy given the differences India and China have - for example, a boundary dispute that keeps cropping up.
"Differences between China and India could play the spoiler in Brics," said an analyst who preferred to remain anonymous.
Sreeram Chauliya, Vice-Dean of the Jindal School of Global Affairs, argued in a recent opinion piece that there was a "dire need for better co-ordination among Brics nations on international political issues. Last year, Brics states were caught flat-footed by the West on the question of intervention in Libya.
"This year, Brics are split right down the middle on the Syrian crisis, with Russia and China vetoing a Western resolution in the Security Council while South Africa and India voted in favour," he said.
Economics and not politics, it would appear, has been the main driving force behind Brics.
Since the 1990s, Brics nations have doubled their share in global economic output and the International Monetary Fund suggests that their GDP will surpass that of the Euro area before 2015.
According to the Brics Trade and Economic Research Network, these five countries account for 43% of the world's population, 18% of global trade and attract 53% of global financial capital.
An editorial in India's Economic Times newspaper on 26 March called for discussions "about moving to a trade system that uses the currencies of the five nations only".
"In this system, Brics trade and investment flows would be accounted and paid for with the real, rouble, rupee, yuan and rand," the newspaper recommended.
According to Biswajit Dhar, now that Russia has become a full member of the World Trade Organisation, the Brics countries could take the lead in driving the multilateral trade agenda.
Other than the main 29 March summit meeting, many eyes will be on the bilateral sessions the leaders have.