BRICS: The new Syndicate
This quarter was dominated by the BRICS alliance. The first BRICS meeting to be held in India was hosted in New Delhi on 29 March 2012. The big announcement was the possible establishment of a BRICS Bank – an alternative and supplement to the World Bank and IMF that currently dominate international development financing today.
The rest of the world is skeptical about what they see as diverse developing nations trying their hand at institutional financial independence. But given the stresses that are threatening the most ambitious financial integration project, the Euro – a new international financial alliance that can keep in mind the lessons from the Euro’s strains – may be a worthwhile experiment for the developing economies. A key concern: Keeping the Renminbi as a partner currency, and making sure it does not dominate (page 7).
Meantime, the BRICS are experiencing troubles of their own: India and China are slowing down economically, and as Gateway House points out, while China is by design, while India’s is involuntary. Putin’s re-election has evoked public protest, but there is also a new xenophobic dimension of nationalism in the country which is noteworthy (page 26). Brazil’s currency is too strong and growth has slowed significantly for the grouping to benefit from each others’ strengths, they must learn from each other – and India and Brazil provide some examples (page 31).
The troubles of the Arab uprisings never far from our shores, is intensifying. The Assad regime is being cornered now, and Western support of various ‘rebels’ in West Asia has caused a full-scale Shia-Sunni split to erupt across the region (page 44). The consequences will be catastrophic.
In March, Gateway House launched its first Global Stability Map, authored by our research head Akshay Mathur and interns. The map, which all our members received, is the first attempt to look at the world’s political, social and economic elements from the viewpoint of a developing country – in our case, from the shores of Mumbai. The map will be an annual feature for Gateway House members.
Enjoy the summer and the mangoes that come with it.
– by Manjeet Kripalani
Executive Director, Gateway House: Indian Council on Global Relations.
| Bi-annual report Jan-Jul 2012.pdf | 5 MB |