Responsibilities, challenges for Russia-led BRICS

Gurjit Singh
Former Ambassador

Russia should spur BRICS to develop a wider engagement with the Global South to achieve the Sustainable Development Goals.

IN a warm New Year message to President Droupadi Murmu and PM Narendra Modi, Russian President Vladimir Putin said: “We are gratified to note that despite all the turmoil happening worldwide, the relationship with our true friend in Asia, India, has been progressing incrementally.” After a five-day visit to Russia late last month, External Affairs Minister S Jaishankar said: “The India-Russia relations remain very steady, very strong… they are based on our strategic convergence, on our geopolitical interests, and because they are mutually beneficial.”

These are signs of optimism amid Russia’s assumption of the BRICS chairmanship. The five-nation grouping was expanded during the summit in South Africa last year. Six new members — Argentina, Iran, Ethiopia, Egypt, the UAE and Saudi Arabia — had come on board. Javier Milei-led Argentina, however, backed out recently.

Russia’s stated BRICS objective is to strengthen multilateralism for equitable development and security around the world. It seeks reduced dependence on the US dollar among BRICS countries and possibly their partners. It is confronting the reality of a severely divided world. The crises in Ukraine and West Asia have caused major geopolitical disruptions.

The emergence of BRICS was, like the G20, in the context of the global financial crisis of 2008. It was meant to be a reform-oriented group which would present an alternative to the G7 and Western narrative, implemented through Bretton Woods institutions such as the World Bank and the International Monetary Fund. Since 2014, BRICS has acquired a distinct geopolitical identity. Without making a strong dent in the dominance of these institutions, it shifted its aim to challenging the US and the G7-led global order. Undoubtedly, the UN and Bretton Woods institutions have run their course. BRICS can provide alternatives or reforms, which would not happen through tentative efforts, notwithstanding the emergence of the New Development Bank (NDB).

Russia is expected to use the BRICS forum to reclaim its position as a pole in the multipolar world order. If it does so, independently of China, this would be a useful exercise. If it is to expand the space for China using the BRICS platform, this is not in the interest of BRICS in general and India in particular.

It is claimed that 40 countries are interested in joining BRICS. Most of them are keen to bank on China, India and the NDB to further their development. What can they really bring to BRICS? Three important countries of the Global South — Argentina, Nigeria and Indonesia — would have brought heft to BRICS.

Argentina’s refusal to join BRICS on the grounds that it is a political rival to the US-led order is significant. Nigeria and Indonesia perhaps do not want to be drawn into a Big Power rivalry. The fact that these countries do not see BRICS as a geoeconomic alternative is damaging for the group’s image.

Russia is well placed to try and remove this anomaly. It should pursue criterion-based expansion and association with BRICS. This process was sidestepped at the summit in South Africa, where six countries were invited without a clear criterion, geographical representation or assessment of their contribution to BRICS. BRICS should not be an institution which will merely add members without seeking their contribution.

The fact that G20 is being chaired by three BRICS members in succession — India (2023), Brazil (2024) and South Africa (2025), all of which are in the South — should add value to BRICS. BRICS cannot become a bridge for Chinese efforts to dominate the narrative of the South. India, the UAE and others would like BRICS to become a vehicle for collaboration with the South, particularly Africa. As no ASEAN member is part of BRICS, it reduces the group’s engagement with the Indo-Pacific. The dominance of West Asian and Arab countries in the expansion exercise will turn BRICS’s focus towards their priorities — the energy sector and the Israel-Hamas war. Can Russia and BRICS help restore order in West Asia?

Russia should spur BRICS to develop a wider engagement with the South to achieve the Sustainable Development Goals and find ways and means of getting its members to contribute through the NDB.

There is Russian and others’ interest in dedollarisation. Efforts are being made to increase direct trading among BRICS members in their own currencies, but this is still largely confined to energy. This has helped Russia sell oil to India, for instance. These energy supplies based on non-dollar currencies have limitations because they don’t diversify into deep trading relationships and lack depth as well as diversity. Reportedly, Russia finds it difficult to earn more rupees because it cannot spend them all on imports from India. The alternative is to invest them in India with buyback arrangements. Similarly, China does not mind greater trade in yuan but does not want to be paid in non-dollar currencies by its partners for its overwhelming volume of exports to many of them.

A wider, deeper and diversified trade relationship with multiple currencies of BRICS members could perhaps lead to the development of an efficient system, but the market framework of Russia, the sanctions that Iran and it are under and the dominance of the energy trade do not make it the best candidate to pursue this objective. Russia would be well served if it could nudge the committee of BRICS experts to seek practical solutions such as a diversified basket of goods and services for trading in local currencies across BRICS nations.

Russia is not a great lender to developing countries and therefore is not a party to the growing demand for relieving debt stress. China is a major player, but it avoids responsibilities, preferring that the Paris Club take the lead and the risks too. Can BRICS countries find a way to help the South reduce its debt stress by getting China to be more flexible?

The BRICS chairmanship is an opportunity for Russia to pull itself out of its Ukraine trap. Time will tell whether Russia will confine itself to self-appreciation or take BRICS on a development path which the globe direly needs.