BRICS: Superpower’s Bloc

BRICS needs no mortar from the west. The socialist- like lineage of all BRICS nations is all the mortar they need, which I feel, also provides comparative advantage in relation to other trading system’s much debated issues. While People are aware about BRICS’s 46% of world population & 26% of world landmass share, the one thing they miss is that the potential & importance of the strategic seashore they control, with great naval strength, I might add. Apart from North Atlantic Ocean, dividing & uniting North America & Europe, there isn’t a major sea route(or ocean) not virtually ruled by the BRICS Nations.  One can’t help but notice that three of the five BRICS nations are nuclear powers and two are Permanent United Nations Security council’s members (other three are intensely pursuing the same status). Four of the members boast of their space agency's technology having sent first native Russian, Hindi, Chinese & Portuguese speakers into space. With Himalayas, Urals etc. adorning their laps, in addition to the unfathomable biodiversity, only adds to the envy of the rest of the trading world. Therefore a meager 20% global GDP held by BRICS nations shows the underutilized potential due to the incoherent efforts of these 5 nations in the past.  The future, well, is a different matter entirely.

The New Development Bank with a subscribed capital of US$ 50 & the US$ 100 billion Contingent Reserves Arrangement are the two concrete steps taken by the BRICS for, (a) financing infrastructure and sustainable development projects in the BRICS and other developing countries & (b) for BRICS nations to use to forestall short-term liquidity pressures and to contribute to international financial stability, by providing an additional line of defense to the BRICS (beyond IMF), respectively.

Let’s find out what brings Brazil, Russia, India, China & South Africa together in the endeavour for BRICS. I am assuming that we know the obvious potentials of the member nations, hence let’s not focus on the obvious.

Brazil: Already a part of IBSA, consistent political & trade ties with China meant Brazil was an obvious choice for this organisation. Brazil and China already share an outstanding balance of trade. Also, Brazil was one of the first to recognize PRC and still does not recognize Taiwan. Brazil stands most evenly to gain from BRICS and further cement its position as the champion of South American Continent. Brazil as an agricultural powerhouse needs this 46% of the World population and that’s just one part of their emerging economy.  When it comes to International aspirations, Brazil also shares much with India like permanent UNSC membership. For Brazil, it was also a golden opportunity of not missing being part of BRICS.

Russia: Russia, with respect, is the runner- up in the Cold war. This brings a lot of advantages & disadvantages with it. With the recent reunification of Crimea, Russia has shown that it is possibly the only country unafraid of western sanctions and has braved it singlehandedly even in today’s interdependent world. It has time and again absorbed the shocks to its economy rashly while taking bold political decisions. But it is also true that Russia is no more immune from the external trade policies/ sanctions and its economy has taken way more hits than it can handle. BRICS seems to be Russia’s best chance at redemption. Russia has largely traded with politically aversive nations in past, and that has had its demerits (Of Course, merits of any kind of trade with any nation is simply worthy). However, with BRICS, Russia has a chance to work with politically non- aversive nations. Indo- Russia relations serve as a guiding example. If Russia explores the trade with other four members properly, it may have to worry quite less about western powers while making its political choices.  

India: The only way India and China will be able to amicably resolve their territorial claims & dispute is possibly through a future trade negotiation. War is not an option for either of them. In this cut- throat competition, any country cannot afford such a costly war and lose out on the long earned edge in their economy. Of course, every other major competing power would be working in its own mysterious way to see to that the possibility of such a war looms large perpetually. As far as siding with Pakistan is concerned, it makes least of political & economic sense for china, apart from a purely balancing tact w.r.t. India, which is unsustainable and has to wither away in very near future.  Believe it or not, more than anything, India lends the moral voice to BRICS, and that I would say equals its contribution in terms of its economy to BRICS. As BRICS’s power grows with time, the western allies would become highly uncomfortable with its existence. The only Solace they are offered is that India remains in BRICS, to see to it that it does not go wayward with time. (one can imagine if in place of India if it were, say Egypt & Saudi Arabia, the whole relevance/ irrelevance of ‘BResCS’ would have been altogether different).

China: The China has always been an object of isolation on international forums at one point on another. It never gets its due share as it deserves at the relevant time. Delayed membership of the WTO & the unnecessary delay in recognition of PRC as the real UNSC member are but a few examples. Moreover, it is often demoralized as a totalitarian state, which is largely true, but using it as a tool is not always justified, at least from China’s viewpoint. It is termed undemocratic despite having a very detailed representative system. It’s a different matter that the rest of the world is not a fan of ‘one party system’, but it’s the choice of their nationals and not west’s. For that matter, the west if not very frequent in criticizing middle- east’s monarchs, on account of being their partners. China needs a very powerful forum to which it can lend its voice equally and be heard fairly. And then there’s the issue of competitive neighbour Japan, which brings China to the threshold of BRICS. 

South Africa: Also a part of IBSA and sharing the dream of becoming permanent UNSC member with India & Brazil, rightly & successfully became full- fledged member of BRICS in 2010 (from BRIC in 2009). Though smaller in many terms from the other 4 members, it sort of provides completeness to BRICS. Arguably the leader of African continent, the untapped potential of enormous mines & minerals reserves, its economy is sure to take off with just the right circumstances the BRICS has created/ is creating.

BRICS Currency: If and when the BRICS nations start to take BRICS extremely seriously, every other comparable system has the potential of becoming a joke. To oversimplify the issue with a highly imaginary example- a common BRICS currency may go a long way in ultimate demise of Dollar & in establishing BRICS as the Trading & financial superpower.  Of course, it’s a very complex issue fraught with macro- economic problems, even for BRICS members. But any dynamic change in new economic world order requires some bold steps. At least it merits a serious thought/ discussion. The demise of dollar is no more a laughable proposition. However, it would be hard enough to draw a consensus within BRICS nations themselves at this point in time. However, we may see the possibility of BRICS currency intensifying in years to come. The writing off of the national currencies completely would not be possible for the Nationalistic members, hence a system with dual currencies may emerge, where there may be a common currency for a large denomination (say, a million). As of now, it’s just a fantasy of an under- informed mind.

The author disclaims intentional bias to any country and in his shallow understanding of world trade & political affairs is merely stating the points which are often missed/ unsaid, and would be happy to learn if mistaken.