The combined association of Brazil, Russia, India, China and South Africa in acronym form is known as BRICS. This association of countries has one thing in common, all of these are very fast developing nations of the world. Since the year 2009, all the BRICS countries take part in an annual meeting.
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Utility of BRICS for India
The utility factor of BRICS for India is more debatable and has multi-fold controversial handling than of a strategic flow of alliances. Expert panels and economists have debated BRICS to be more of a discussion board than anything else. The top most reason being the greater utility of BRICS being taken over by China, rather than consuming it by India itself.
Further, to study BRICS in Indian context, we can talk of greater power to India in the UN and WTO blocks. Multilateral trade openings are influenced in India to a great extent by the BRICS strategies. The dependence on financial grounds can be overcome to a very large extent by the BRICS bank.
Every other day, we say new economic ties and strategies springing at various corners of the global. Such global trade is easily facilitated under the BRICS consortium for Indian premises. Since India is a developing country, it has its own unique set of challenges and conditions to promote its global markets and development models. These challenges are exhibited, talked about and showcased on a collaborated platform like BRICS.
Membership Opportunity for India
The greatest feature or outcome that India can expect from the BRICS membership is to attain its dream of becoming a superpower nation in the near future. The developed countries of the world have an upper hand when it comes to key strategic decisions in the UN, IMF and the world bank.
India can leverage its own strategic opposition and opinion columns collectively using the BRICS platform. Global politics has taken over scenes of national and regional politics. India is conducting business and politics on the international level and this is getting recognised, all thanks to its membership in BRICS.
If we look at India’s output in terms of trade and commerce, business is mostly and by large a service sector influenced establishment in India. That said, progress on economic grounds is mostly dependent on the performance of the service sector. Other member countries of BRICS have large scale contributions from the manufacturing sector than the service oriented industries.
So the membership of India can be decisive and critical in providing mutual benefit through its service orientations. To further its role in exports of services, the membership in BRICS is very imminent.
Expansion of exports can happen only when markets are explored for business opportunities, provided there is no trespassing of the law of the organization which the member countries are catering to Indian membership can ease its tensions when it comes to cross-border communal exchanges and troubles with neighbouring countries.
BRICS Development Bank
As the name itself suggests, the BRICS development bank is mainly to facilitate financial aid to the BRICS member nations. Earlier, it was the world bank and the IMF that strengthened and displayed monopoly over financial transactions and entities on a global level. To overcome this dependence and to cut open false attributions of global monopoly, the BRICS development bank was formalised.
This bank outreaches member nations and provides assistance to member nations in three main goals, namely, providing financial ground for infrastructure projects, offering or lending hand or providing loans whenever countries seek financial borrowings and handle inter-convertible debt exchange transactions with member nations. It is just like any other bank, the difference here being the member nations that would benefit from bank entity.
The bank allows aid and offers financial assistance to private projects, public holidays, calls for partnership from equity players. The headquarters of the bank is at Shanghai in China. Though the chief motive of the bank is to aid in financial assistance for projects, it also aims to co-operate and derive assistance from fellow entities and tie-up with financial structures across the globe.
Not just financial and money matters, the bank also takes a step forward and provides support in a technical way to on-going projects funded by the bank. It is a matter of pride for our nation as the first president of the bank was an Indian, namely, Mr. K.V. Kamath. The bank also plans to open another regional centre at Johannesburg to sense financial interests across globe.
The BRICS was initially formulated as a group to give a push to developing economics to basis a leveraging financial backbone structure and help them during times of crisis. But in the recent years, expert economic thickens and platforms have given other advice. They prefer seeing India out of the BRICS block so that new opportunities on new shores could be explored.
It is also to be noted that India to a great extent enjoys a relatively stable position in the BRICS holding. The leadership factor associated with India is quite high. But when we dig deeper and pull out the economic and strategic utilities that India is gaining, the result is relatively getting low.
The main reason for this scenario is the anti-western sentiment doing the rounds. The BRICS top panels suggest giving a free-counter approach to western financial institutions. So, the BRICS countries can take west-led banks head on and create a levelled competition against them. This agenda in formal business language is termed “Bretton Woods System”.
The reason for the agenda not doing great marvels for the BRICS members is the failure of member countries to create common motto and agreements between themselves. Instead of throwing competition with the third parties in the west, it is quite laudable and appreciated if the members themselves stitch together a unique fabric that gels with the nations.
Common strategic development, together with common economic relief measures and sustenance opportunities could ease the anti-western settlement.
Struggles of other BRICS members
The stiff and brewing competition between the BRICS members is creating a non-healthy, slowly growing ground for member nations. Whether nations are taking on risks in their respective economies on welcoming new opportunities is quite debatable.
The competition among the member nations apart from growing face-off with western counterparts is creating a struggle-led development for members. BRICS members are seen struggling with their policies and strategies formulated on their respective financial markets, export of goods, geographical advantage/disadvantage and political turmoil. Poor unity in policy making corners and no common ground of interests is making situations worse than ever.
The question looming large is of priorities concerned with member nations. Member nations find it difficult to put place an equilibrium of policies and priorities. China, to a very great extent takes lead in pushing itself ahead of other members. China’s upper take on its currency could further lead to resentment in action with other members.
Creating an emergency pool with vested interests is another sure shot problem. System of reserve currencies is getting a voice amongst BRICS members. The IMF specifies its own quota when it comes to listing members. BRICS members have always struggled to find a better hold in the IMF platter. Some of the BRICS members enjoy permanent seat in the UN security council but others do not. So, this stands as a priority for some and an undermined activity for other members.
The ‘China Factor’
Every member of the BRICS tries to push its own economic agenda in front of the forum. Very often, china as a member nation can be seen showing a superior hand and move in all rounds and aspects of the forum. For some key watchers, the BRICS decision making entity is seen as a pro-china diplomatic unit. China, on the other hand also take careful, well thought of steps to put its own economy in front of other fellow member nations.
China can also be attributed for zooming in a higher success rate at BRICS discussion panels. Compared to other member nations, it is generally the Chinese economy that showcases a higher GDP figure than any other member. This century can also be seen as the economic well being factor thriving in countries other than the western dominants.
A lot of this credit is taken up by china seeing a huge-influence on its own in BRICS. BRICS overall sees a high rate of 17% in terms of foreign trade and commerce, a good 18% in the investment if created on foreign shores and that is seriously commendable.
The world’s largest population country is China and a big percent of the progressive and development enabled community is living in China. These figures create a separate ‘China Factor’ on the rolls of BRICS walls and thus a mechanism of co-operation and reformed ties in institutional architectures are sought after.
The IMF’s voting system also is on the Chinese reform radar, all these and more translating into Chinese domination in global business.
India’s Economic Interests in BRICS
India is no less a competitive economy to China or other BRICS economics. Some places, its growth can be counted to be more than China recent reforms in policy making at higher levels of public institutions seeking greater amounts of well being and stability in financial setups paved way for this.
India seeks to derive greater co-operation in particular in conducting business catering to the goods market. Setting up sophisticated and well-bred, infrastructure enabled business models also remain top priority and a gain-seeker at BRICS. India has tried to achieve greater economic results by looking out for innovation in the way it is doing business.
India has also called out for strong policy making doors on the board of BRICS. Be it good fiscal policy structures to foster economic well being for the nation. India’s monetary scene is an all time high. This has also helped India better its position, holding and stake good claims at BRICS forums.
Financial analysis have weighed upon watching expansion of markets into international shores, attracting direct foreign investment, creating space for transparency and modern implementation. The open markets in India add to greater economic interests laid down in BRICS.
However the feedback from the side of BRICS for improved performance in economic statistics to Indian members remain citing of varied figures and tallics and unaccounted debts and fiscal interests in banks, which may be a pull down factor to the economy.
India’s Strategic role in BRICS
Unlike the sliding down of china’s markets, Indian markets continue to forecast a more stable and growth driven performance. This has provided India a very strategic position in BRICS. Greater cooperation at all levels and platform in policy making activities of BRICS has cased multilateral relationship to a great extent.
Not only this, developing close ties with member nations and keeping up the peace and harmony factor among member nations is top priority. India has to cater to more demand in food and energy supplies and address security issues.
One of the major strategic parts of its membership in BRICS is to handle global terrorism and help its own land and member nations to act on issues like infiltration and combat cross-border terrorism. India has also been a key strategic entity in the BRICS forum to promote healthy economic growth while taking care of monetary expectations and healthy political growth in the country.
The US federal reserves have a significant and major role to play in terms of global order. Member nations have sought withdrawal of policies from BRICS to join the US securities for more lucrative business opportunities.
India as a fast developing, global entity needs to be strategic and focused in its decision-making and policy making concerns to handle any given situation. With slow moving economies and slow development across global markets, India has proved its stability once again and gone on to review its policy making and implementation.