The paradox of BRICS, its new pathway – downfall and resurgence | 24th May 2023 | UPSC Daily Editorial Analysis

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What's the article about?

  • It talks about the paradoxical evolution of the BRICS grouping, including both their decline and simultaneous rise.


  • GS2: Bilateral, Regional and Global Groupings and Agreements involving India and/or affecting India’s interests;
  • Essay;
  • Prelims


  • Multilateral and Regional organisations rise and fall down. For example, Non-Aligned Movement (NAM) and G-77 had their heyday in the Cold War era, but now they are nothng.
  • BRICS, which began its function in 2006 had a remarkable start, but somehow it started losing its charms and was on the verge of downfall.
  • But at the same time, more than 20 countries want to be part of this grouping. This suggests a paradoxical evolution of the BRICS.

What is BRICS grouping?

  • BRICS is an acronym for the grouping of the world’s leading emerging economies, namely Brazil, Russia, India, China and South Africa.
  • The acronym “BRICS” was initially formulated in 2001 by economist Jim O'Neill, of Goldman Sachs, in a report on growth prospects for these economies.
  • In 2006, the four countries initiated a regular informal diplomatic coordination, with annual meetings of Foreign Ministers at the margins of the General Debate of the UN General Assembly (UNGA).
  • This successful interaction led to the decision that the dialogue was to be carried out at the level of Heads of State and Government in annual Summits.
  • The first BRIC Summit took place in 2009 in the Russian Federation.
    South Africa was invited to join BRIC in December 2010, after which the group adopted the acronym BRICS.
  • BRICS does not exist in the form of organization, but it is an annual summit between the supreme leaders of five nations.
  • The Chairmanship of the forum is rotated annually among the members, in accordance with the acronym B-R-I-C-S.


  • Progress of BRICS:
    • BRICS focused its attention on both geopolitical and economic dimensions.
    • By articulating a common view on key global and regional issues, it projected a non-western view.
    • This strengthened the world’s march towards multipolarity, thus helping to curb the dominating influence of the West.
    • On the economic front, it launched new initiatives:
      • the New Development Bank which has committed $32.8 billion in 96 projects;
      • the Contingent Reserve Arrangement (CRA), a financial mechanism to protect against global liquidity pressures; and
      • a comprehensive programme to expand trade and investment cooperation among the five-member countries.
  • Downfall of the BRICS:
    • The IBSA trio within the BRICS expected that China and Russia would fully back their bid to secure membership of the UN Security Council; they were disappointed.
    • China’s dramatic economic rise and, more importantly, military assertiveness disturbed the group’s inner balance.
    • The post-Ukraine consolidation of Russia-China cooperation, economic malaise in South Africa that accelerates dependence on China, and Brazil’s long fling with rightist policies followed by the return of a tired Lula da Silva as the President, have generated new tensions.
    • Beijing’s push for a common currency for intra-BRICS trade is also symptomatic of the group’s inner troubles.
    • Despite these negative developments, 19 countries now stand in line, eager to join BRICS.
  • Why do other countries want to join BRICS despite the above-mentioned downfalls?
    • First, China is pushing the expansion as a strategic device to extend its global influence.
    • Second, the demand to join BRICS stems from FOMO or ‘fear of missing out’ on the membership of a club that has some visibility.
    • Third, many realize that the doors of other groupings are closed to them.
    • Finally, the clamour reflects prevailing anti-western sentiments and a pervasive desire to create a sizeable forum of the Global South.

New Development Bank (NDB):

  • It is a multilateral development bank jointly founded by the BRICS countries at the 6th BRICS Summit in Fortaleza, Brazil in 2014.
  • It was formed to support infrastructure and sustainable development efforts in BRICS and other underserved, emerging economies for faster development through innovation and cutting-edge technology.
  • It is headquartered at Shanghai, China.
  • Votes are based on the members’ shareholding.
  • Membership is open to all UN members.
    • Bangladesh, the United Arab Emirates, and Uruguay joined the NDB in September 2021. Egypt was welcomed as a new member of the NDB in December 2021.
  • In 2018, the NDB received observer status in the United Nations General Assembly, establishing a firm basis for active and fruitful cooperation with the UN.
  • The NDB has so far approved 14 Indian projects for an amount of nearly USD 4.2 billion.
    • It has committed funding to a number of major infrastructure projects in India, including the Mumbai Metro rail, Delhi-Ghaziabad-Meerut Regional Rapid Transit System and many Renewable Energy projects.

BRICS Summits:

  1. Yekaterinburg, Russia – 2009
  2. Brasília, Brazil – 2010 
  3. Sanya, China – 2011  
  4. New Delhi, India – 2012 
  5. Durban South Africa – 2013 
  6. Fortaleza , Brazil – 2014 – NDB
  7. Ufa, Russia – 2015 – CRA
  8. Benaulim, (Goa) India – 2016
  9. Xiamen, China – 2017
  10. Johannesburg, South Africa – 2018
  11. Brasília, Brazil – 2019
  12. Saint Petersburg Russia – 2020
  13. India, 2021
  14. China, 2022

Contingent Reserve Arrangement:

  • Considering the increasing instances of global financial crisis, BRICS nations signed BRICS Contingent Reserve Arrangement (CRA) in 2014 as part of Fortaleza Declaration at Sixth BRICS summit.
  • CRA was established in 2015 during 7th BRICS summit in July 2015.
  • The BRICS CRA proposes to provide short-term liquidity support to the members through currency swaps to help mitigating BOP crisis situation, in case such a situation arises.
  • The CRA is generally seen as a competitor to the International Monetary Fund (IMF) and along with BRICS New Development Bank (NDB) is viewed as an example of increasing South-South cooperation.

Way Forward:

  • The next BRICS summit will be hosted by South Africa on August 23-24. It could take decisions on expansion and its criteria.
  • When the leaders talk, they should reflect on strengthening BRICS and redressing the internal imbalance.
  • They should also know that once new members are admitted, they will certainly seek to change the group’s name. Perhaps then the grouping’s future will be better than its past.

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