Recalibrating Alliances

The Russian Federation hosted the 16th BRICS plus summit during October 22-24 in Kazan—the largest city and capital of Tatarstan, Russia, which lies at the confluence of the Volga and the Kazanka rivers. Russian President Vladimir Putin, who faces international isolation and is labelled a possible war criminal by the International Criminal Court (ICC), hosted 36 world leaders at the BRICS summit. The ICC arrest warrant for Putin also means he cannot travel to countries that are signatories to the Rome Statute, a UN treaty that established the court, without risking arrest. The meeting in Kazan was attended by representatives of almost 40 countries, including leaders of a number of the Commonwealth of Independent States, Asian, African, Middle Eastern and Latin American countries, as well as heads of international organisations.

Russian President Vladimir Putin closed the annual BRICS plus summit on Thursday, praising its role as a counterbalance to what he called the West’s “perverse methods.” The three-day summit in the city of Kazan highlighted the failure of United States-led efforts to isolate Russia over its actions in Ukraine, reports AP.

In a significant move, at the 16th BRICS summit Russia unveiled a symbolic BRICS banknote, stirring debate over the US dollar’s dominance. Russian President Vladimir Putin emphasised that the dollar is being used as a ‘weapon,’ but BRICS isn’t rejecting the currency entirely, instead it is preparing alternatives for restricted access. India advocated for local currency settlement among BRICS nations. Replying to a question, Russian President Vladimir Putin has said the time has not come yet for a common BRICS currency but added that the 10-nation bloc is exploring the use of digital currencies in mutual trade and investments for which his country is working with India and other nations, reports the Business Standard. He highlighted that nearly 95 per cent of trade between Russia and China is now conducted in rubles and yuan. A joint declaration adopted by BRICS member countries has called for the creation of an independent payment system based on national currencies, in response to what they deem “illegal” sanctions damaging the global economy.

BRICS Plus: the expanding BRICS

The leaders of BRIC (an acronym denoting the emerging national economies of Brazil, Russia, India and China ) countries met for the first time in St. Petersburg, Russia, on the margins of the G8 Outreach Summit in July 2006. Shortly afterwards, in September 2006, the group was formalised as BRIC during the first BRIC Foreign Ministers’ Meeting, which met on the side-lines of the General Debate of the UN Assembly in New York City. After a series of high-level meetings, the first BRIC summit was held in Yekaterinburg, Russia, on June 16, 2009. South Africa joined BRIC in 2010. Since 2009, with Russia playing a more active role, BRICS has evolved into a formal global independent organization, with annual summits and publications.

At the 15th summit (2023) of BRICS, the leaders of the member nations agreed to enlarge their group from January 1, 2024. Accordingly, Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates have been invited to become full members of BRICS. After the change in political leadership in Argentina, it abstained from joining BRICS. Though Saudi Arabia has yet to formally join, the others have. Now BRICS plus have a total of nine members namely Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Iran, and the United Arab Emirates. Saudi Arabia is expected to join soon.

It is reported that BRICS is continuing to expand. Southeast Asian countries like Malaysia and Thailand have recently expressed an interest in joining the alliance. Most significantly, NATO member Turkey also formally requested to join BRICS in September and its President Recep Tayyip Erdogan attended the 16th BRICS summit.

Just ahead of the Kazan summit, TV BRICS has launched an Arabic version of its news portal, extending its reach to Arabic-speaking audiences in the Middle-east. Arabic is now the sixth language offered by the network, joining Russian, English, Chinese, Portuguese and Spanish.

The expanded BRICS group now represents about 45 per cent of the world’s population and 25 per cent of the global gross domestic product (GDP). The original four BRIC members control 72.5 per cent of global reserves of rare earth minerals, with China alone producing 85 per cent of all globally refined earths in 2020. Rare earth minerals are a critical input for the production of a huge range of products from high-tech weaponry to every-day consumables including electric cars, circuit boards, semiconductors, and mobile phones. It is claimed that rare earths face huge demand, as part of the global supply chain for products that are consumed by the rapidly expanding global middle class – of which China, India, Brazil, and Egypt alone will account for 59 per cent in 2024.

Big event for Vladimir Putin

Experts have agreed that the Kazan summit has offered a great symbolic and practical importance for the Putin regime. The summit has demonstrated that, far from being isolated, Russia has important partners like India, China and other major emerging powers.

A month after the launch of Russian full-scale invasion of Ukraine in February 2022, Canada, the European Union, Japan, New Zealand, Taiwan, the United Kingdom and the US unveiled a slew of sanctions on Russian banks, oil refineries and military exports. Since then there have been more sanctions on Russia and its allies.

It may be recalled that in 2023, he skipped the 15th BRICS summit in South Africa, which is a party to the treaty. As Western leaders are also largely unwilling to join Putin in any multilateral setting, Putin had to skip the G20 summit in India even though New Delhi is not a party to the Rome Statute. Significantly, during his visit to the BRICS summit at Kazan, the Indian Prime Minister invited Putin to India for the 2025 India-Russia Annual Summit.

Leaders of BRICS member countries – including Indian Prime Minister Narendra Modi, Chinese President Xi Jinping and South African President Cyril Ramaphosa – attended the summit. Brazilian President Luiz Inacio Lula da Silva cancelled his trip to Russia after suffering a head injury in a fall at home on October 19. Minister of Foreign Affairs Mauro Vieira represented the country at the summit. UAE President Mohamed bin Zayed Al Nahyan, Iranian President Masoud Pezeshkian, Egyptian President Abdel Fattah el-Sisi and Ethiopian Prime Minister Abiy Ahmed have also participated in the Kazan summit. Saudi Arabia was represented by its Foreign Minister. Prince Faisal represented Saudi King Salman at the meeting. Most significantly the United Nations Secretary-General Antonio Guterres attended the 16th BRICS summit.

In addition to these world leaders, the President of the State of Palestine Mahmoud Abbas also attended and held a meeting with the Saudi Foreign Minister Prince Faisal bin Farhan on the side-lines of the BRICS summit. .

BRICS’ objectives

De-dollarisation and abolition of decades’ long hegemony of the US dollar with the creation of a common BRICS currency is one of the major objectives of BRICS. Noting that the progress of emerging and developing countries are hindered by a Western centric economic and political order, the BRICS have engaged in a number of actions to rebalance and counteract the existing global order alongside its institutions, notably to reduce dependence on the World Bank and International Monetary Fund—institutions that are historically led by Europeans and Americans and are often criticised for their lack of transparency and draconian structural adjustment programs.

Keeping this in mind, in 2015, BRICS established the New Development Bank (NDB) to mobilise resources for infrastructure and sustainable development projects with an initial authorised capital of USD 100 billion. The BRICS Summit provided an important platform for strengthening dialogue and cooperation between the New Development Bank and BRICS as well as other emerging markets and developing countries (EMDCs). NDB website claims that NDB prioritises high-impact operations that are climate-smart, disaster-resilient, technology-integrated and socially-inclusive. So far it has approved 96 projects with a financial commitment of USD 32.8 billion.

Russia is working on creating a payment infrastructure to bypass the SWIFT payment system, based in Belgium. This move is part of a broader de-dollarisation initiative, aimed at reducing reliance on the US dollar. It is reported that ahead of the summit, a new cross-border payment system, BRICS Pay, was introduced at the BRICS Business Forum in Moscow. The platform aims to simplify transactions between BRICS nations, cutting transaction costs and time, and shielding economies from currency fluctuations and geopolitical tensions.

The Chinese President Xi Jinping on Wednesday (October 23) called on BRICS members to conform to the general trend of the rise of the Global South and actively respond to the call of countries to join the BRICS cooperation mechanism. The Chinese president also called on BRICS members to build BRICS for innovation and act as pioneers for high-quality development. Xi called for building BRICS for justice and leading the reform of the global governance system. The Chinese president urged BRICS countries to advocate peaceful coexistence and harmony between civilisations. In addition, he called on BRICS members to build green BRICS and be practitioners of sustainable development. China will establish 10 overseas learning centres in BRICS countries to provide training opportunities for 1,000 education administrators, teachers and students, Xi said, reports Global Times.

It is observed that economic and trade ties among BRICS countries are becoming increasingly close, and China is playing an important role in driving mutually beneficial BRICS cooperation. According to Xinhua, China’s foreign trade with other BRICS member countries reached 4.62 trillion yuan (648 billion US dollars) in the first nine months of 2024, a year-on-year increase of 5.1 per cent, customs data showed.

Kazan Declaration

The 16th BRICS Summit concluded on Wednesday, October 23, with the adoption of the Kazan Declaration, a comprehensive 43-page final communiqué that addressed a range of topics, including geopolitics, artificial intelligence, and the preservation of endangered species. Here are a few major decisions :

• Under the theme “Strengthening Multilateralism for Just Global Development and Security”, the Kazan Declaration emphasised the importance of BRICS solidarity and strategic partnerships. The leaders pledged their commitment to fostering peace, ensuring a fairer international order, and promoting sustainable development.
• The summit addressed pressing international conflicts, with the declaration emphasising the need for peaceful resolution through diplomacy.
• The summit underscored the importance of the G20 in global decision-making.
• The BRICS nations reiterated their pledge to improve global governance by advocating for a more agile, responsive, and representative multilateral system. This includes reforms to the international financial architecture and promoting inclusive growth.
• The leaders encouraged new financial practices. “We welcome the BRICS Interbank Cooperation Mechanism (ICM) focussed on facilitating and expanding innovative financial practices.”
• A key highlight of the summit was the agreement to strengthen trade and financial settlements in local currencies. The declaration welcomed the use of local currencies in BRICS financial transactions and supported the exploration of an independent cross-border settlement infrastructure.
• The BRICS nations agreed to explore initiatives that could further integrate their economies, such as establishing a BRICS Grain Exchange and studying the feasibility of a BRICS Cross-Border Payment System and BRICS (Re)Insurance Company.
• The establishment of a BRICS-based grain exchange was welcomed. “We welcome the initiative of the Russian side to establish a grain (commodities) trading platform within BRICS.”

Observations

In a very significant development, Indian PM Modi met Chinese President Xi Jinping, after a gap of five years, on the side-lines of the BRICS summit and agreed to work towards a “peaceful and stable” relationship by displaying maturity and mutual respect. They also highlighted the need to not allow differences on boundary-related matters to disturb peace and tranquillity along the line of actual control (LAC). The meeting between the two leaders comes just two days after they settled a tense border dispute. According to the Economist, the epic bust-up between China and India could be ending.

A formal thaw in the border disputes with China after long years of disagreements may force India to relook into its much hyped ‘China plus one’ policy and rely on China for investment and technological collaborations. India may also revive its ‘Look East / Act East Policy’ which has been practically abandoned after the Modi government came to power. In near future, India may also decide to join China’s flagship program—Belt and Road Initiative (BRI) and become a member of China-initiated Regional Comprehensive Economic Partnership (RCEP)

BRICS has gathered pace as shared grievances against West fuelled alliance among member states. Recent diplomatic rows with Canada and USA on Khalistani terrorist issues might have pushed India towards the China-Russia axis. At the Closed Plenary session, PM Modi emphasised the need for a people-centric approach to solving global challenges, highlighted UPI’s success story, and urged for global unity against terrorism.

During the last few years, India has broadly aligned itself with Western interests against China. The availability of Western economic support and access to technology has increased significantly and

West-India relations are experiencing a new era. In addition to significant economic benefits for India, the presence of a large Indian diaspora in Western countries made the Modi government very sensitive about being seen as permitting a rival bloc to G7 interest.

Though the West has been trying to rope India into the dwindling G7, the country cannot afford to distance itself away from the rising and expanding BRICS. During the 15th BRICS summit, last year, it appeared that owing to its pro-US leanings India might find it difficult to sustain itself in BRICS which seeks to foster multi-polarity by challenging the American hegemony. But, in the 16th BRICS Summit, concluded this week in Kazan, India’s role looked more in line with the central geopolitical strategy of the core members of the BRICS.

If BRICS can ensure formal inclusion of Saudi Arabia in its extended BRICS plus bloc where Iran is already a member, then BRICS will certainly emerge as an alternative voice of the Global South to challenge the US dollar-dominated unipolar world order.

The major area of concern about the BRICS Plus bloc is that it’s a group headed by autocratic leaders. The members of the BRICS plus bloc are dominated by non-democratic authoritarian nations. On the democracy index, though South Africa and India have decent scores, both the countries’ democracy index has declined by 11 per cent and 8 per cent, respectively, between 2006 and 2022. The worst score of 1.94 goes to China, which is 35 per cent lower than the China’s democracy index of 2006. Only two nations where the democracy index has improved during this period are the UAE and Saudi Arabia. But their democracy score is still very low. On corruption perception index also, the member countries’ scores and ranks are very low. The UAE is an exception with 26th ranks globally – the best among the BRICS members.

In 21st century, the totalitarian undemocratic regimes have a bleak future. Unless the BRICS leaders address this issue, BRICS will find it increasingly difficult to establish itself as a viable alternative to the Western blocs like the European Union where member countries practice and profess democracy.

Views expressed are personal