NEWS ANALYSIS: The Five BRICS Build an Alliance U.S. Need Not Fear

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By Shastri Ramachandaran in New Delhi

As the globalised world continues the search for an overarching new order, the emergence of any new alliance of sorts is bound to be resisted, and resented, by dominant powers in the existing order. BRICS -- the grouping of Brazil, Russia, India and China which has expanded to embrace South Africa -- is no exception.

The first summit of the five emerging economies in Sanya on the Chinese tropical island of Hainan is a ringing affirmation that BRICS has arrived. It is dedicated to the pursuit of international political, economic and financial reforms with a view to correcting the big-power bias in institutions such as the UN and situations such as that faced by Libya.

BRICS would have been viewed with scepticism by the West even if it was not a product of developing countries, just as those at the helm of a dollarised world were unfriendly to the euro as another global currency. The dollar vs euro analogy is relevant here as BRICS is committed to recasting the global monetary system and make it less dependent on the dollar.

Although the way to accomplish this was not spelled out, at Sanya, BRICS nations made a beginning by signing a pact to use their own national currencies instead of the dollar for grant credit to each other.

The currency of power is, well, currency. The financial meltdown was the result of systemic flaws in the economic powerhouses of the West. But recovery is being driven by the turbo-charged GDP growth of the poorer, developing nations.

It is only fair that those burdened with leading the recovery should want a say in improving and reforming the international financial system. And, central to such reform is a more broad-based reserve currency other than the dollar.

That will not happen anytime soon, but the articulation of such an aspiration by BRICS may compel developed nations to be mindful of the interests of developing countries. Since monetary reform can happen only at the end of a series of political and economic reforms, this may serve to make the West more flexible in matters such as expansion of the UN Security Council (UNSC).

However, BRICS does not necessarily improve India's chances of permanent Security Council membership. Neither China nor Russia has come out openly in favour of India. On the contrary, India's thrust for a permanent seat is weakened with South Africa being clubbed as yet another aspirant -- along with India and Brazil. When the race for the UNSC begins in earnest, the present calculations and alignments may be rendered irrelevant, and every BRICS nation would be wooing the U.S. and the European Union (EU).

Therefore, BRICS cannot afford to, and will not, be a bloc opposed to the U.S. and EU. None of the five in BRICS would do anything that hurts bilateral relations with the U.S. For China and India, too, the U.S. is the most important partner, which explains the emphasis at the Sanya summit on BRICS not being anti-U.S. Actually, every member of BRICS would seek to use this forum to further advance their interests with Washington.

BRICS opposition to Western military intervention in Libya exemplifies this dilemma: Collectively it hopes to influence the course of international action, but individually, not one of them represented the BRICS stance in the UNSC.

When it came to the critical resolution, Brazil, India, Russia and China abstained (when the last two could have used their veto) and one (South Africa) voted for it.

Obviously, coming together as BRICS is easier than acting together as BRICS. All for one and one for all is a long way off. However, BRICS, in the larger interest of its own cohesion, may push India and China to sort out unresolved bilateral issues sooner rather than later.

Actually, there is only one issue: the boundary. Special Representatives of India and China are negotiating a settlement. In the mean time, there are occasional reports of transgressions that threaten peace and tranquility on the border. To address this, the two countries have agreed to a mechanism on border coordination and consultation.

If both sides stick to the negotiations and the mechanism, there is, really, no other problem. Stapled visas for Jammu and Kashmir residents were Beijing's "creation", which China, by all accounts, has agreed to end. In return, high-level defence exchanges, suspended because of the visa refusal to lt general B S Jaswal, are to be resumed.

The rising trade deficit in China’s favour is not really a problem. With trade booming, periodic imbalances should not snowball into irritants, and the “undervalued” yuan is hardly a 'bilateral issue'.

If BRICS spurs India and China to solve their problem, it would be no mean achievement. Impact, like charity, is best felt at home.

The author is a political and foreign affairs commentator. A similar article first appeared in

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