BRICS is a grouping of five major emerging economies. It comprises Brazil, Russia, India, China and South Africa. BRICS nations account for 40 per cent of world population, 25 percent of global GDP and 18 percent of international trade. The 15th summit of the Bloc at Johannesburg in South Africa ended on 24 August 2023. Amid extensive dissatisfaction with existing international system, concentration of power and wealth in the West, domination of greenback currency, abusive trade practices, perceived neglect of developing nations, coercion of sanctions regimes and the US exclusive power projection on world affairs, the pledge of BRICS nations to make the Bloc a leading champion of the ‘Global South’ has found resonance. The Bloc aims to zero in on the need for emerging powers to have a greater voice in global governance.
Despite internal differences, the BRICS nations have agreed to expand the club with the admission of new members. China has long called for an expansion of the group as a means of fostering a multipolar world order to challenge Western dominance and counterbalance G-7 Bloc of wealthy democracies which are critical to the policies of China and Russia. To create a viable counterweight to the West, China and Russia push to forge the BRICS an alternative to the West-led international order. For assuaging themselves from the pressure of the West in their diplomatic and economic affairs, developing countries will be lured toward BRICS. Approximately 40 countries have shown desire to join the group and 22 nations have formally asked to be admitted. It can diversify the Bloc in terms of economy, politics, demography and geography.
With the expansion of BRICS, many countries like Iran and Venezuela have been motivated largely by a desire to level a global playing field which they consider to have rigged against them for a long time. It is believed that the enlargement of BRICS will rebalance the global order and provide opportunities to developing economies to trade in local currencies—replacing dollar in intra-Bloc trade to take the edge off dollar exigency due to sanctions, trade deficit and low foreign reserves. Besides this, the Bloc also offers alternative to the west-dominated institutions — the IMF and the World Bank.
For a coordinated financial policy, BRICS nations have created New Development Bank in 2015. The NDB has invested about $30 billion in infrastructure development projects in member and other developing countries. Critical of the dollar predominance in global trade, one of the major aims of the member nations is to free themselves from the US dollar. Although the leading developing countries of BRICS are trading in national currencies instead of dollar through the mechanism of ‘BRICS pay’, a consensus among members is afoot to create BRICS currency to replace the US dollar altogether. Yet, the member states do not see eye to eye over BRICS currency.
Indeed, BRICS quest to develop alternative payment mechanism to dollar and SWIFT payment system will receive a good deal of currency in international political economy. As long as dollar is the sole currency for international trade, the US may wield clout on global affairs and influence foreign policy of developing nations as Washington dominates the world financial institutions, thereby using the ‘carrot and stick’ policy by granting aid and loans to those who serve the US geopolitical interests and by imposing sanctions on those which are critical to its ambitions.
The US has long weaponized the dollar for its geopolitical objectives. Obviously, dethroning the dollar in international trade will not only diversify the international payment systems in global trade, but it also facilitates the developing countries to forebear walking tightrope in their external affairs. However, experts believe that ditching US dollar is an uphill task given the dominant role of the US and its allies in global economy.
Aggrieved by the US hegemonic position on global power structure, rising power China, resurging Russia and momentum-gathering India have found BRICS a platform to promote multipolar world order that enables them to have greater space in international system. The US monopoly of key global institutions has put them in a subordinate role despite their growing economic and political strength. Though India is considered a ‘weak link’ in the Bloc on account of New Delhi’s role of a potential spoiler in major decisions of the Bloc like BRICS currency and conditions for the admission of new members, India finds the group an opportunity to project its geopolitical ambition for promoting multipolar world order in which India is considered a power to be reckoned with because bipolar power structure denies it a space.
However, internal divisions, lack of coherent vision, varying political systems, uneven diplomatic positions and different geostrategic interests of members may obstruct the club’s geopolitical ambitions. Indo-US strategic partnership and Sino-India border tension and amicable relations of Brazil and South Africa with the US dim the prospects of BRICS to challenge the West-led world order. ‘Global South’ is also not in a position to create a coherent power equation under BRICS to rival G-7 or other West-controlled financial and political institutions. Obsessed with power ambitions, member countries may sit together but think differently.
Yet, given the shared interest of BRICS members like expansion of the club, trade in national currencies, greater voice in global governance and promotion of multipolar world order, they will cooperate against all odds to attain a greater space in existing international system. Similarly, global geopolitical polarization not only provides an impetus to the expansion of BRICS, but it also makes the group more relevant for developing countries. In changing global geopolitics, Pakistan can take advantage to become a member of the club to promote its economic and diplomatic interests. In fact, political and economic stability is sin qua non for a proactive and independent foreign policy.
—The writer is a strategic affairs and foreign policy analyst, based in Islamabad.
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