What is BRICS?
BRICS is an acronym for Brazil, Russia, India, China, and South Africa. The term was initially "BRIC" (without South Africa) and was coined by Jim O’Neill, an economist at Goldman Sachs.
Key Facts About BRICS:
- Formed to enhance economic cooperation among emerging economies.
- It represents 41% of the world population and contributes 25% to global GDP.
- Accounts for 16% of world trade.
Objectives & Principles of BRICS
BRICS operates on the principles of:
- Non-interference – Respect for each country’s sovereignty.
- Equality – No member is dominant over others.
- Mutual benefit – Economic cooperation and shared development.
Three Key Pillars of BRICS Cooperation:
- Political & Security – Addresses global security and diplomatic issues.
- Economic & Financial – Enhances trade, investment, and financial stability.
- Cultural & Social – Promotes collaboration in education, science, and health.
How Does BRICS Function?
- Annual Summits: Since 2009, BRICS nations have held formal summits. The first summit was held in Yekaterinburg, Russia.
- New Development Bank (NDB): Established in 2014 (Fortaleza Summit), it funds infrastructure and renewable energy projects (approved loans worth $8 billion).
- Contingent Reserve Arrangement (CRA): A financial stability fund to assist countries during the Balance of Payment crises.
Modes of Cooperation:
- Track I: Official diplomatic discussions between governments.
- Track II: Engagement through government-linked institutions.
- Track III: Civil society and people-to-people collaboration.
Impact of BRICS on the Global Economy
- Promotes Financial Stability – Provides liquidity support through currency swaps.
- Challenges Western Economic Dominance – Pushes for IMF & World Bank reforms.
- Encourages Pluralism – Strengthens global governance based on equality.
- Economic Growth – Increases FDI & trade among member countries.
Key Takeaways
BRICS sets global financial and trade agenda. Promotes economic cooperation, development and balance.
