The 21st century saw two important developments, which led to a paradigm shift in international politics. The demise of the Soviet Union in 1991, led to the end of an international system characterised by tight bipolarity of power between the US and Soviet Union; and was accompanied by the rise of multiple poles of power, leading to a multipolar international order, populated by several multilateral organisations. However, even within the multipolar system, the various poles of power have varying degrees of power in relation to one another. National interests continue to remain of paramount interest even within multilateral organisations, and states undertake various approaches to secure their own national interests over and above that of others in multilateral groupings. An example in this regard would be that of the BRICS grouping, comprising of Brazil, Russia, India, China and South Africa.
The success of the grouping is encapsulated in the formation and functioning of the New Development Bank. Additionally, the BRICS countries, in the last decade have contributed to 50 per cent of the global economic growth. India and China, have the highest growth rates in the grouping, and despite several avenues of disagreements in the bilateral relationship find ample scope for cooperation in the BRICS.
The 10th edition of the BRICS was held in Johannesburg, South Africa last month, and the theme of the summit this year was ‘BRICS in Africa: collaboration for inclusive growth and shared prosperity in the 4th Industrial Revolution’. Therefore, as evident from the theme, the arenas for cooperation were myriad – ranging from inclusive growth to investment in Africa to cooperation in the realm of the fourth industrial revolution. This revolution, as defined by the World Economic Forum, is characterised “by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres.” Like the preceding industrial revolutions, this revolution has the potential to raise global income levels and to improve quality of lives. So far, the ones benefiting the most from this revolution have been the consumers who can afford and access technology and the digital world.
Therefore, in order to ensure that the 10th edition of the BRICS adheres to its theme, it was pertinent that member countries reach consensus on key issues like governance, health and vaccines, socio-economic empowerment, peacekeeping, science, technology, infrastructure, sustainable development as well as the multilateral trade and globalisation. The overall backdrop in which the summit was taking place was that of increasing US unilateralism and the protracted trade war between the US and China, which now threatens to cripple global trade and investment. Therefore, as expected, a significant part of the summit was dedicated to discussions on trade and tariffs.
Before analysing the outcomes of the summit, it becomes important to understand the expectations and goals of the member countries from the summit. For Brazil, which has been suffering a sluggish economy, threatened greatly by the US trade and currency war, the expectation was a new form of cooperation between the members of the BRICS grouping which could benefit the economy. For Russia, as stated by President Vladimir Putin, better business ties between counterparts was an expected outcome, along with cementing cooperation in energy and developing new technologies. For India, the tenth edition of the group was an opportunity to further the ‘Make in India’ mission and to bring together member nations on a common ground against terrorism and trade wars.
The point to note is that India has also been slapped with tariffs by the US, which even though are not at the same scale as those slapped on China, do exist. India also needs higher investments from other countries and the BRICS platform could be an important one for the purpose. For China, the major component of economic growth of which has been export dependent, the necessity was to defend its export-led growth regime and to bring other countries on board against the US, which traditionally has absorbed most of its exports and fuelled its economic rise, but now threatens to derail it with the imposition of massive tariffs against Chinese products. For China, it was important to make a point by creating a coalition in the BRICS directed against the unfolding belligerent nature of US trade policy. For South Africa, which is cash strapped in the urgent need for cleaning up governance issues, gainful investments from member countries was a priority.
Therefore, protection and furthering free trade is a thread that was a common expectation of all the members. This was an expectation fully met as the BRICS countries, at the end of the three-day summit stated that they want a fairer and more representative global order in diplomacy and trade. They also stated that they seek reforms at the United Nations (UN), UN Security Council (UNSC) and the International Monetary Fund (IMF) for better representation of developing countries and have asked that the members of the World Trade Organization, including the US, abide by its rules. The irony in the statement is that while it calls for a reform of the UNSC, China actively blocks India’s candidature at the UNSC. Both China and Russia have reservations regarding an expansion of the UNSC to include more developing countries, which will make the UN more representational!
In the context of the WTO, the BRICS standpoint again seems hypocritical, as it is India, which has dragged China the maximum number of times to the WTO for flouting rules on dumping of goods. Therefore, a practice what you preach approach becomes necessary for China in this context as well.
China pledged USD 14.7 billion in investment in South Africa, including loans to its state power utility and Logistics Company, which was in line with South Africa’s expectation from the summit of more investments. While Xi Jinping led the call for multilateralism and free trade during the summit, the fact remains that the IMF’s annual report card on the Chinese economy criticises the pervasive role of the state in the economy and the restrictive trade and investment regime of the country. The BRICS declaration has also called for deeper cooperation among the members in terms of trade – a point that meets the expectations of all the members. However, what needs to be ensured is that the BRICS declaration is lived up to in letter as well as in spirit. Trade with China is generally skewed in China’s favour and the trading partners’ products often face a barrage of tariff and non-tariff barriers in the Chinese market. Therefore, it is essential that the BRICS declaration is actually lived up to and protectionist practices are done away with.
The recent BRICS summit has paid off for China, in terms of building a coalition of emerging markets that seek to defend the current multilateral trade regime. There has never been an agenda before, and BRICS as a group talking about liberalised trade has never been witnessed before, as observed by Martyn Davies, managing director for emerging markets and Africa at Deloitte in reference to the earlier summits. But now trade is at the front and foremost. The full text of the declaration mentions the terms “free” and “trade” the maximum number of times over and above the others. Therefore, even though the BRICS is a symbol of multilateralism, it is clear that even within multilateral institutions, there is bound to be the preponderance of the most powerful countries – in the case of BRICS, it is China’s. While national interests remain of utmost importance for every country, including for China, it is essential that multilateral groupings like BRICS focus more on arenas wherein cooperation is actually furthered, instead of agenda setting, which might bifurcate the world and lead to a retreat of a version of previous world orders.
(The author can be reached at sriparnapathak@gmail.com, or @Sriparnapathak on Twitter.)
Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the view of Manipal Advanced Research Group.
Dr. Sriparna Pathak, Assistant Professor at Nowgong College, Gauhati University and a former Consultant at the Ministry of External Affairs, New Delhi.
