BRICS Expansion: Bigger but Better?

BRICS Expansion: Bigger but Better?
Posted on 02-09-2023

BRICS Expansion: Bigger, But Is It Better?

Origin and Evolution of BRICS

  • BRICS initially comprised Brazil, Russia, India, China, and South Africa.

  • Concept originated in 2001 with Goldman Sachs' prediction of economic prominence.

  • Formalized as a grouping in 2006.

The Recent Expansion

  • Johannesburg summit expands BRICS to 11 members.

  • New members: Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, UAE.

  • Emerging economies with growth potential.

  • Desire to navigate global geopolitics.

India's Role in the Expansion

  • India leads efforts to shape membership criteria.

  • Advocates for inclusion of strategic partners.

  • India has strategic partnerships with four new members.

Region-Wise Significance of Expansion

  • Latin America: Argentina chosen despite regional rivalry.

  • Africa: Ethiopia and Egypt selected for economic and strategic value.

  • Asia: Saudi Arabia, UAE, Iran added, addressing Muslim-majority gap.

Challenges Associated with the Expansion

  • Economic Dependencies on China for Argentina and Egypt.

  • Geopolitical Contradictions within the group.

  • Potential to limit BRICS' effectiveness.

Russia, China, and India's Stakes

  • China seeks to build its bloc against Western powers.

  • Russia hosts next BRICS summit in 2024, enhancing its relevance.

  • India's challenge: Preventing undue influence from China.

The recent decision at the Johannesburg BRICS summit to expand the BRICS grouping from five countries to 11 has raised questions about whether this enlargement will lead to a better and more influential alliance. To understand the implications of this expansion, it's essential to examine what the new members bring to the BRICS table and how India, in particular, may be affected given the economic dependencies some of the new members have on China.

The BRICS grouping, which originally comprised Brazil, Russia, India, China, and South Africa, represents a substantial portion of the global population (around 41%), global GDP (approximately 24%), and global trade (about 16%). The concept of BRIC was first introduced by Goldman Sachs in 2001, predicting the future economic prominence of Brazil, Russia, India, and China. It officially began as a grouping in 2006 and was formalized in subsequent years.

The recent expansion, as outlined in the Johannesburg declaration, includes Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates (UAE) as full members starting from January 1, 2024. These new entrants are emerging economies with significant growth potential and a desire to navigate the increasingly polarized geopolitical landscape.

However, the specific criteria and procedures for this expansion have not been made public, leaving room for speculation about how these new members were selected. With 11 members, BRICS now surpasses the size of other regional groupings like ASEAN (10 members) and the Shanghai Cooperation Organisation (9 members).

It's important to note that this expanded BRICS grouping is not viewed by India as an anti-West alliance, and there is interest from Western countries, such as France, in engaging with BRICS. Whether France becomes a member would require consensus among the existing members.

India played a key role in shaping the criteria for membership and advocated for the inclusion of strategic partners among the new members. India has strategic partnerships with four of the six new members, namely Saudi Arabia, UAE, Iran, and Egypt.

The expansion also has regional significance. Argentina and Egypt, despite regional rivalry, were chosen from Latin America and Africa, respectively. Ethiopia's inclusion acknowledges its status as one of the most populous nations in Africa and a rapidly growing economy. Egypt's geo-strategic importance, with the Suez Canal facilitating 12% of global trade, adds to the group's strategic value.

Among the new Asian members, Saudi Arabia and the UAE have strong ties with the United States, while Iran has been strengthening its relations with China. The inclusion of these countries is expected to enhance financial resources for the New Development Bank, which serves as the BRICS alternative for developing nations. Notably, this expansion also addresses the absence of Muslim-majority countries in the grouping.

However, challenges accompany this expansion. Both Argentina and Egypt have significant economic dependencies on China, and Beijing's support has been crucial for these countries in times of financial crisis. Contradictions within the group, particularly in the West Asian and North African region, could limit BRICS' potential due to regional rivalries and geopolitical tensions.

For Russia and China, the expansion allows them to solidify their alliance against Western powers, with Russia hosting the next BRICS summit in 2024 to bolster its relevance amid diplomatic isolation. India's main challenge is to ensure that the grouping remains balanced and not overly influenced by China, which seeks to include countries indebted to it. India emphasizes consensus as the guiding principle to prevent undue dominance.

In conclusion, BRICS has expanded significantly, but whether it becomes more effective and influential with this enlargement remains to be seen. The dynamics among the 11 members, their economic dependencies, and their ability to navigate geopolitical complexities will shape the future of BRICS. Like many multilateral groupings, its success and relevance may evolve over time.

  • BRICS has expanded significantly.

  • Success and influence will depend on dynamics among 11 members.

  • Evolution of BRICS' relevance over time remains to be seen.

Thank You