Context:
- The Johannesburg declaration, issued after the BRICS summit, said Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates (UAE) had been invited to become full members from 2024.
Origin of BRICS
- Five of the largest developing countries of the world, representing around 41 per cent of the global population, around 24 per cent of the global GDP, and around 16 per cent of global trade.
- The acronym BRIC was first used in 2001 by Jim O’Neill.
- The grouping was formalised during the first meeting of BRIC Foreign Ministers on the margins of the UNGA in New York in 2006.
Expansion
- The Johannesburg declaration said that BRICS had reached a consensus on the guiding principles, standards, criteria and procedures of the expansion process, but these have not been made public.
- India has strategic partnerships with four of the new six members – Saudi Arabia, UAE, Iran and Egypt.
- By growing to a size of 11 members, BRICS has become larger than ASEAN (10 members) and Shanghai Cooperation Organisation (9).
- But while many portrayed the new expanded grouping as an alternative to western blocs like the G7, India doesn’t view this as an “anti-West” grouping.
- The new entrants are emerging economies with the potential to scale up. Many belong to the Global South or the developing countries, and want to hedge their bets in the increasingly polarised geopolitical landscape.
Countries from Africa and Latin America
- From Latin America, despite Brazil’s reluctance, regional rival Argentina was selected as a new member. With a Gross Domestic Product (GDP) of approximately US$610 billion, Argentina is one of the largest economies in Latin America.
- From Africa, Ethiopia and Egypt made the cut, over Nigeria, Algeria and Senegal.
- According to the World Bank, Ethiopia is the second most populous nation in Africa after Nigeria, and one of the fastest-growing economies in the region, with an estimated 6.4% growth in FY 2021/22.
- Egypt occupies a crucial geo-strategic location — 12 per cent of global trade passes through the Suez Canal — and is a key player in the region. An important economic powerhouse, it is an emerging economy with reforms brought in by the government.
- But both Argentina and Egypt have strong economic dependency ties with China.
Countries from Asia
- Saudi Arabia and UAE are strong partners of the US, and along with Egypt, have close ties with US.
- Iran, which has had a complicated relationship with the US, has been wooed by China in recent years.
- The inclusion of Saudi Arabia and the UAE is expected to lead to more mobilisation of financial resources for the New Development Bank, the BRICS alternative for developing countries.
- By including these four, BRICS has also addressed the question that no Muslim-majority country is in the grouping.
- Saudi Arabia, UAE, Iran, Egypt and Ethiopia share a common regional space. This might give salience to the West Asian and North African region, and the rivalries and geopolitical tensions here might play out in the grouping as well.
- These contradictions within the member countries could limit the potential of BRICS.
Russia, China’s stakes
- China is seen as trying to build its own bloc against the Western powers. But India has maintained that decisions have to be made “through consensus” — the guiding principle in the grouping — so that it is not completely led by China.
- This inclusion of six members has been projected as the first phase of the expansion, which leaves room for a second phase.
- Russia, the other major player in the grouping, will host the next BRICS summit in Kazan in 2024. An expanded grouping of 11 members attending will work for Moscow, which has been facing diplomatic isolation. It will use the opportunity to portray Russia’s relevance despite Western pressures.
- For India, the Chinese challenge remains the most pertinent. India has the unenviable task of guarding against the grouping being swayed by China, which wants to pack it with countries indebted to China.
Name
- For now, the name of BRICS will remain the same, since officials feel it is a brand in itself. There were jokes during the negotiations on whether the grouping should be renamed ‘Wall’. But the Chinese were fine with the current name, as they call the grouping ‘Jin Zhuan’ in Mandarin, which means ‘golden bricks.