BRICS GROUPING AND ITS EXPANSION

The six additional nations include Iran, Saudi Arabia, and the UAE from West Asia; Egypt and Ethiopia from Africa; and Argentina from Latin America.

OUTCOMES OF 15TH BRICS SUMMIT

 • Reaffirmation of Multilateralism and Reform: BRICS leaders reiterated their commitment to principles such as multilateralism, adherence to international law, and sustainable development. They advocated for the restructuring of global organizations like the United Nations to enhance inclusivity and responsiveness to the needs of developing nations.

• Exploration of Common Currency: BRICS leaders initiated discussions on the potential development of a shared currency for trade and investment within their nations. Finance ministers and central bank governors were tasked with assessing the practicality and benefits of introducing such a currency, aimed at reducing reliance on the US dollar and other major currencies.

• Space Cooperation Initiative: Prime Minister of India proposed the establishment of a space exploration consortium within BRICS nations, highlighting India's recent lunar mission achievements.

• Addressing Global and Regional Challenges: BRICS leaders discussed a wide array of global and regional issues, including the Covid-19 pandemic, climate change, terrorism, cyber security, energy security, trade, and investment. They emphasized fair access to vaccines and medical resources globally and committed to strengthening collaboration in health, research, and innovation.

Implications of New Members Addition:

Energy Resources:

• The inclusion of Saudi Arabia and Iran, prominent West Asian nations, holds significant geostrategic importance due to their vast energy reserves.
• Saudi Arabia, a major oil producer, supplies a substantial amount of oil to BRICS nations like China and India.
• Despite facing sanctions, Iran has increased its oil production and exports, focusing primarily on China, underscoring the critical role of energy cooperation and trade among BRICS members.

Diversification of Energy Suppliers:

• Russia, traditionally a key oil supplier to China and India, is exploring new markets for its energy exports with the addition of new BRICS members.
• This diversification enhances the potential for varied energy sources within the BRICS framework, contributing to energy security and economic stability among member nations.

  Strategic Geographical Presence:

• Egypt and Ethiopia, strategically located in the Horn of Africa and the Red Sea region, hold significant geostrategic importance due to their proximity to crucial maritime trade routes.
• Their inclusion strengthens BRICS' geopolitical influence in this strategic region, facilitating enhanced cooperation in trade, infrastructure development, and security among member states.

 Latin American Economic Influence:

• Argentina, as one of the largest economies in Latin America, brings substantial economic influence to the BRICS coalition.
• Latin America has historically been a focal point for global economic interests, and Argentina's inclusion bolsters BRICS' presence in this region, opening avenues for increased economic cooperation, trade diversification, and strategic partnerships.

Significance of BRICS:

Economic Influence:

• BRICS represents major emerging economies, contributing significantly to global GDP and trade.
• The New Development Bank (NDB), established in 2015, has committed $32.8 billion to 96 infrastructure and sustainable development projects in member countries like Brazil, Russia, India, China, and South Africa.
• Currently, the five-member grouping is home to 40 per cent of the world's population, which controls 26 per cent of the global GDP, But with the six new members (BRICS+6), their GDP share will jump to 30 per cent and share of population will go up to 46 per cent.

Political Influence:

• BRICS serves as a platform for geopolitical coordination and cooperation on global issues.
• Fareed Zakaria calls it Post American world order and describes BRICS as the fall of west and rise of rest.
• BRICS National Security Advisors’ meetings focus on counterterrorism, cybersecurity, and regional stability, enhancing collective security efforts.
• Joint statements and initiatives by BRICS leaders on reforms in global governance institutions like the IMF and World Bank underscore their influence in shaping global policies.

Development and Infrastructure Projects:

• BRICS promotes joint development projects and infrastructure initiatives.
• The Contingent Reserve Arrangement (CRA), established in 2015 with a total lending capacity of $100 billion, supports member countries facing balance of payments difficulties due to liquidity pressures.
• CRA provides financial stability and resilience against global economic uncertainties, benefiting member economies during crises.

Cultural Exchange and People-to-People Ties:

• BRICS enhances cultural exchange and people-to-people contacts through various initiatives.
• BRICS Parliamentary Forum, Film Festival, Youth Summit, and Academic Forum foster mutual understanding and cooperation in cultural, academic, and youth exchanges.
• These initiatives promote cultural diplomacy and strengthen ties among member countries, facilitating deeper regional integration and collaboration.
• Strategic Partnerships and Security Cooperation: BRICS fosters strategic partnerships and security cooperation among member countries. BRICS countries collaborate on counterterrorism efforts, cybersecurity,etc.

 BRICS Payment System:

• BRICS countries aim to establish a payment system as an alternative to SWIFT, reducing dependence on dollardenominated transactions.
• The BRICS Payment System seeks to enhance financial autonomy and resilience against external economic pressures.
• This initiative reflects BRICS' efforts to strengthen economic sovereignty and mitigate risks associated with global financial systems.