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Grouping has come a long way from an informal venue for exchanging views to a mature and stable network of multilateral interaction and a pillar of the global economy.
“India would almost definitely be the least eager to join the G9 club. They might regard any obligations as unwelcome, as well as possibly seeing their own experiences as limiting their ability to give 'advice'. However, in view of their size, population and potential (and their geographical location), the possible inclusion of India would be attractive.” Those were the words of Jim O'Neill in 2001, then the chairman of Goldman Sachs Asset Management. O'Neill - who went on to serve as Commercial Secretary to the UK Treasury between 2015 and 2016 in the governments headed by David Cameron and Tsheresa May, made a case on the basis of econometric analyses projecting that four economies in the world would individually and collectively occupy far greater economic space and become among the world's largest economies in the next 50 years or so.
He identified these countries as Brazil, Russia, India and China - and coined the term 'BRIC' to describe the four emerging giant economies.
Nineteen years later, while the vision of a G9 grouping has not fully come to fruition, India finds itself as among the biggest emerging economies in the grouping and beyond, especially in G20. With the addition of South Africa to the group, BRICS now brings together five economies accounting for more than 42 per cent of the world's population, 24 per cent of the global GDP and an around 19 per cent share of world trade.
The central role of BRICS economies in G20 was in the spotlight once again this week when Indian Finance Minister Nirmala Sitharaman participated in the first BRICS Finance Ministers and Central Bank Governors (FMCBG) meeting under the BRICS Russian Chairmanship.
The agenda of the meeting included discussions on the outcomes of the current Saudi presidency of G20, a digital platform to encourage infrastructure investments and expansion of the membership of the New Development Bank (NDB).
“The Indian Finance Minister observed that the G20, of which all BRICS countries are members, has delivered some very significant initiatives this year including the G20 Action Plan in response to Covid-19, which has provided broad guidance to navigate a collective global response to the crisis. Additionally, the G20 Debt Service Suspension Initiative ensured immediate support to address the liquidity needs of low-income countries,” a statement issued after the meeting said.
Against the backdrop of the Covid-19 pandemic, BRICS members have thus played a crucial role in ensuring that concerns of emerging economies are appropriately reflected in these initiatives - becoming a vital pillar of support for the global economy.
On the ongoing international efforts to find a solution to the issue of taxation of the digital economy, Sitharaman said that a consensus solution will play an important role in ensuring fairness, equity, and sustainability of tax systems. "The BRICS Finance Ministers and Central Bank Governors also discussed expansion of the membership of the New Development Bank (NDB). The Finance Minister supported the expansion of the membership of NDB and emphasised the importance of regional balance. She shared her perspective on Russia′s initiative to develop an integrated Digital Platform (Data Room)," the statement added.
With Russia chairing this year's BRICS Summit next week, the meeting will bring Chinese President Xi Jinping and India's Prime Minister Narendra Modi face-to-face for the first time since a military standoff between the two countries in Ladakh started more than five months ago. But given the virtual format of the meeting, it is not known whether the two can have a meeting on the sidelines which could facilitate a diplomatic resolution of the ongoing situation.
But the platform undoubtedly offers both India and China a unique space.
“The BRICS allows India and China to modulate their rivalry within the setting of a small grouping, even when bilateral relations remain rocky. This was clear during the Doklam standoff of 2017, when both sides remained engaged through BRICS throughout the entirety of the crisis; this has also been the case so far during the ongoing Ladakh standoff,” said Abhijnan Rej, writing in the Diplomat. “Groupings like the BRICS and the SCO afford both India and China the opportunity to 'decouple' their strategic contest from the other dimensions of the relationship.”
The summit is also a potent opportunity to strengthen cooperation on a host of other issues - from counter terrorism and multilateralism to reforming global agencies such as the United Nations, economic development of BRICS societies and boosting trade and investment in a post-Covid world. As the global economy recovers from the devastating impact of coronavirus, the resurgence of BRICS is a welcome sign not only for the countries themselves but also - as recently described by India's External Affairs Minister Dr S. Jaishankar, provides a solid foundation for a multipolar world hit by unprecedented crisis.