Big Question: Does BRICS have a future?

It’s indisputable that the world is in acute need of reform which would make it less unequal, violent, crisis-prone and unjust. 

 

The Great Recession, the globe’s worst economic crisis since the 1930s, continues to wreak havoc on millions of people’s well-being. Disparities between the developed and developing countries remain obscenely high, while poverty destroys human potential the world over. The climate-talks impasse continues. And global warming is set to cross way beyond the 1.5-to-20 C maximum the planet can tolerate, endangering humanity’s survival.

 

The world is as violent and conflict-prone as ever, with no sign that the volatile Central-Southwest- West Asia region will settle down anytime soon. A dangerous crisis is developing around Iran’s nuclear programme. Israel’s threatened attack against Iran could set off a regional conflagration.

 

Large numbers of governments around the world are losing legitimacy and authority. Poverty of leadership is stark in global institutions. The post-War world order is in deep crisis and the bloc of North Atlantic states and Japan no longer provides leadership to it. The bloc’s authority and influence are in decline although it faces no systemic challenge after the Soviet Union’s collapse. 

 

So any attempt to develop alternative global leadership and new ideas for international governance is welcome in and of itself. For this reason alone, the formation of BRICS, the grouping of the world’s fastest-growing large economies comprising Brazil, Russia, India, China and South Africa, generated high hopes that they would provide alternatives and contribute something new to existing multilateral and plurilateral institutions and country blocs.

 

After the BRICS’ fourth summit, held in New Delhi, such hopes must be greatly moderated; some must even be abandoned. BRICS still remains a work in progress—a grouping without much cohesion and commonality, a tentative attempt to assert the need for change in the world order and the architecture of global institutions, but not yet demanding specific major changes. 

 

This is the case despite the considerable weight the BRICS command, accounting for more than a quarter of the world’s landmass, a little over 40 percent of its population, about one-fifth of its GDP, and more than one-half of its hard currency and gold reserves. They have recently been a major engine of global economic growth, accounting for over 50 percent of it. 

 

Yet, unlike the West, which is bound together by strategic interests, a developed capitalist system, and increasingly by a market-based society, the BRICS don’t share a coherent identity, ideology or common political system. Nor are they agreed on how global institutions should be reshaped. Each of  their members is big enough to exercise some influence in global affairs. They have joined hands primarily to increase their heft. 

 

The grouping started as BRIC, a conceptual category invented in 2001 by Jim O’Neill of the investment bank Goldman Sachs. South Africa was added to it last year. The BRICS’ midwife was Russia, a defeated superpower which belongs to no major bloc in any international negotiations. Although its economy is growing thanks to high prices of oil and gas, Russia commands nowhere near the influence it did as the leader of the Soviet bloc. 

 

 

The other BRICS members all belonged to G-77, the developing-country umbrella group formed during the 1970s’ trade and investment talks, which shows growing divergence between its smaller and bigger members. This divergence became starkly obvious with a virtual split in the G-77 during the recent climate talks. 

 

China is a class apart within the BRICS because of its sheer economic size, level of industrialisation, and scorching pace of growth for over two decades. The group’s trade interests also diverge considerably. Russia and Brazil are primary commodity exporters, while China and India are commodity importers.

 

 

The BRICS share more in common in respect of global financial flows, of which they are major recipients. They all want to maintain strong national autonomy over foreign investment policies. But their common interest is limited to ensuring that this autonomy is preserved despite the pressures of globalisation and their rapidly growing integration into the world economy. 

 

On climate change, the subject of extremely important negotiations under United Nations auspices, the BRICS have very little in common. Russia belongs to the Annex 1 category of countries which have binding obligations to reduce greenhouse gas emissions. The others don’t. But Russia has huge surplus emissions allowances under the Kyoto Protocol. So these obligations don’t mean much.  

 

The other four formed the BASIC grouping in late 2009 mainly to avert binding commitments. But BASIC got considerably weakened and fractured at the last climate summit, at Durban. China and India opposed binding obligations in principle. Brazil and South Africa were willing to accept them under conditions such as monetary compensation and incentives for preventing deforestation. 

 

South Africa, the host state, was keen to ensure the Durban climate conference’s success, and offered compromises. China too took a different stand from India’s by saying it would accept future binding commitments under certain conditions. It’s another matter that these conditions—such as full extension of the Kyoto Protocol beyond 2012, and markedly different climate responsibilities for the developed North and the developing South—were unlikely to be fulfilled. The point is that India was isolated and BASIC’s unity came under strain. 

 

Do the BRICS have much in common on reforming the international political and security order? The honest answer is no—although all of them are acknowledged regional powers with aspirations to global influence. India has a “strategic partnership” with the United States, with whom both China and Russia have a partly adversarial relationship.  

 

Russia and China are permanent members of the UN Security Council with veto power. The other three are aspirants. China is reluctant to expand permanent membership, especially to include Japan and Germany, with whom India and Brazil have formed the G-4 grouping. Russia and China are recognised nuclear weapons-states under the Non-Proliferation Treaty. India isn’t, although some of its BRICS partners recognise its de fact nuclear status. 

 

What the BRICS do have in common is an interest in limiting the overwhelming military power of the Western bloc, signified by NATO and the US’s ability to mobilise support for unilateral interventions, such as those in Iraq and Afghanistan. They also urge caution on Syria and especially Iran, from which both China and India buy significant proportions of their oil needs. 

 

Russia is particularly wary of the US’s missile defence programme—which will erode the deterrent value of Moscow’s nuclear weapons—and its interference in the “near abroad”, Russia’s immediate neighbourhood, including through the “colour revolutions” in Ukraine and Georgia. China loathes America’s growing military presence in its own neighbourhood. The other three BRICS partners don’t share this suspicion of the US and the Western bloc. 

 

These differences apart, the BRICS’s greatest limitation arises from the fact that they all share a peculiar relationship with Washington. This is best understood through the “hub-and-spokes” image of a bicycle wheel. However significant their relationships with one another, their relationship with the US is far more important, indeed pivotal, to each of them. Managing it is a higher priority for each than promoting BRICS collectively. 

 

This is as true of China or Russsia as of India, which is eager to join any negotiating bloc, from Central and Southeast Asia, to the G-20.  

 

That’s why the BRICS are no rival to the West, at least not yet—despite the recent general decline of US economic clout and political power. They are not about to centrally challenge the existing global order, dominated as it by the West since the Second World War, with the USSR providing some countervailing force until the late 1980s. The BRICS at best want to be accommodated into the order through an expansion of the global oligarchy of power. 

 

So it wasn’t altogether surprising that the BRICS, which demand a reform in international financial institutions, and larger voting power in the World Bank and the International Monetary Fund, didn’t put up their own candidate when Mr Dominique Strauss-Kahn lost his job as the IMF executive director last year. 

 

Nor have the BRICS sponsored a common candidate for the World Bank’s presidency, which will fall vacant soon. They have been silent on President Barack Obama’s nomination of Korean-American Jim Yong Kim for the post. They are still reluctant to challenge the transatlantic hegemony of the two institutions—despite their calls for democratising them. 

 

What of the worthy proposal for a BRICS-sponsored global development bank? That has been put off with a working group mandated to study it further. This wasn’t unnatural. But the issue has been given a low priority (number 13) in the 17-point future agenda outlined in the BRICS’ Delhi Declaration. 

 

BRICS has a chance to emerge stronger and more relevant if it mediates effectively on issues like Palestine, Syria and Iran. If it can find a solution to the Iran nuclear crisis that allows Iran peaceful nuclear activities under international inspection, while preventing a weapons programme, it could be a winner. But that moment may not have yet arrived.