The Great Wall Against China

THERE WAS A TIME WHEN BRICS—THE partnership of Brazil, Russia, India, China, and South Africa—was jokingly dismissed by some as the only world body invented by a merchant bank: the term ‘BRIC’ was coined by Jim O’Neill, chief economist at Goldman Sachs in 2001 in ref­erence to Brazil, Russia, China, and India. But if one person took the joke seriously, it was Russian President Vladimir Putin, who suggested in 2006 that the four countries meet regularly. The group­ing was soon formalised—and nobody has looked back since. South Africa joined in 2011, solidifying the BRICS’ presence across the Global South, with only Russia in the North.

Today, the five member states are increasingly being taken seriously as sig­nificant players in global affairs. The bloc met for its annual leader’s summit in Johannesburg, South Africa in August, with the highlight of the fifteenth sum­mit being the agreement to admit six new member countries: Argentina, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates (UAE), who will officially join the group in January 2024. The expansion of BRICS to a BRICS+ format with 11 members and the adoption of guiding principles, standards, and procedures for the same has potentially made BRICS—unless they decide not to retain the name—a more attractive institution for consensus-building and dialogue in the developing world. There were some worries that expansion was largely directed by China and would seek to make the grouping more of an anti-Western forum. But most of the new members do not fit into such a descrip­tion. Are they a forum of the Global South, then—except for the presence of the decidedly Northern Russia? Could the collective entity they represent prove a major force, with a host of other countries scrambling for BRICS membership? Or might the 11 countries be far too strained by their own contradictions to constitute an effective new political configuration? Furthermore, what does the expansion mean when not long ago, there were even questions about whether there was enough sustained interest within the original BRICS to stick together?

The issue came up in my own work, as then-Chairman of India’s Parlia­mentary Standing Committee on External Affairs, in the context of the BRICS Parliamentary Forum that the Russians pro­posed during their chairmanship of BRICS in 2015, which elicited some scepticism in India. What on earth could India’s fractious and rum­bustious Lok Sabha, with its impassioned de­bates and disruptions, have in common with China’s decorous National People’s Congress (NPC), a rigorously controlled echo chamber for Communist Party decisions? The natural corollary of this is to question whether BRICS even possesses a strong enough basis for coop­eration. Do we have enough of a common agen­da to build on across the board? Some observers argue that it is only a negative coalition of states that cannot agree on a common position, but can create a consensus on what they oppose, and that it is growing in number to avoid sanc­tions and protectionist measures. However, judging this movie by the old scripts of the Cold War era would be a grave error, largely because the constancy of traditional partners has changed and we are now in a different era.

BRICS, in its original embodiment, was iden­tified as those nations whose rapidly growing economies were challenging the size and pre­ponderance of G7. Indeed, in the last 15 years, Brazil, Russia, and India have caught up with the smallest G7 economy (Italy) in terms of nominal GDP, while China has overtaken Ja­pan to become the second-largest economy in the world. After the expansion, the group now accounts for 40 per cent of world population and 13 per cent of world GDP. The BRICS+ expansion will increase the bloc’s share of nominal global GDP, weighted for purchasing power parity, to 37 per cent, compared to 30 per cent for G7.

The expansion thus signifies a growing alignment of geopolitical and economic agen­das within BRICS. It now incorporates major global oil producers near crucial trade choke­points, such as the Suez Canal and the Strait of Hormuz and Bab-el-Mandab Strait. India, Iran, and Russia are already developing the Interna­tional North-South Transport Corridor. Saudi Arabia and the UAE, two of the world’s largest oil and gas exporters, supply most of China’s energy imports. Simply put, they are too big to be ignored, both individually and, in particular, together.

But what is it that draws BRICS close as nation states in their organised ‘re­bellion’ against the global order? As it happens, one major attribute all BRICS members share is their exclusion from the places they believe they deserve in the existing world order. Being denied legitimate positions on the global stage by today’s dominant powers is proving to be very strong glue that holds the grouping together and, at some level, causes them to look for alternatives to the existing world order. The refusal to be drawn into a contest of competing global powers is a general perception in the Global South that should not be underestimated. Western countries need to understand that BRICS+ will continue as a loose group­ing, heterogeneous in its membership but with high aspirational dimensions, seeking to expand its practical capabilities for other countries around the globe.

The key player as well as concern, of course, is China, whose economic output far outstrips the other members, and whose role will be determinant in BRICS’ global effectiveness. After decades of an almost isolationist approach to world politics, China has been stretching its sinews on the world stage. Its eco­nomic interests span the globe, and Beijing seems to see merit in complement­ing these with an expanding array of partnerships with other countries. Some of these are unilaterally led, like its revival of the ancient land and maritime Silk Routes as a platform for Chinese trade and investment. But Beijing is also show­ing increasing interest in multilateral engagements with like-minded nations, partially to compensate for not having the role it believes it deserves in existing institutions like the World Bank and the International Monetary Fund (IMF).

China’s economic prowess has led analysts to view the expansion of BRICS as a reflection of the grouping becoming a handmaiden of Chinese interests. We must be careful before accepting this argument at face value, though. Although the democracy and human rights records of several of the new invited mem­bers are relatively poor, the formation of BRICS+ is more than a mere political manoeuvre to advance China’s vision of international order. And if Beijing wants to build a bigger anti-Western tent, it can’t do it by adding so many friends of the US inside it. Egypt, Saudi Arabia, and the UAE are close US security part­ners. Even if they have their differences with Washington, they are unlikely to abandon US security guarantees for untested Chinese promises.

In his address to the Johannesburg summit, Chinese President Xi Jinping called on BRICS nations to “practice true multilateralism” and “reject the at­tempt to create small circles or exclusive blocs”. Well, India is already part of at least two such “small circles”. One is the Quadrilateral Security Dialogue (Quad), with Australia, Japan, and the US; the other is the I2U2 forum that joins India with Israel, the UAE, and the US. In Johannesburg, Indian Prime Minister Narendra Modi even called for “resilient and inclusive supply chains”, an obvi­ous euphemism for reducing economic dependence on China.

So if China sees BRICS as a forum for expanding its role in the Global South, so does India—and, for that matter, the Saudis and Emiratis, who are willing to deploy large chunks of the capital they have accumulated over the decades for economic and political gain in Africa and beyond. But India, for its part, realises that BRICS and its future expansion would be futile if it were to reduce itself to a platform that merely mirrors the conflict between Washington and Beijing. Nor can it be allowed to resemble an echo chamber of the Sino-Russian axis. New Delhi is also in a unique position to prevent this. Given its own strategic aspirations, goodwill with Washington, and legacy with South Africa and Brazil, India has the potential to be the stabilising factor that makes the future of BRICS brighter than its problematic past.

China’s economic prowess has led analysts to view the expansion of BRICS as a reflection of the grouping becoming a handmaiden of Chinese interests. We must be careful before accepting this argument at face value

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IN THE PROCESS OF REVITALISING THE PLURILATERAL GROUPING, India can also pursue its own core interests—engaging with the Global South, fostering mutually beneficial multilateral cooperation, and using the West’s efforts to meet its security and development needs to constrain Chinese influence in the re­gion. The enlargement of BRICS from a group of five nations to 11 could lead to increased influ­ence for both India and the collective body. This is because the expanded coalition encompasses a higher proportion of energy-producing coun­tries, and BRICS’ expansion could give India more clout with a set of nations with which it is keen to expand relations. Additionally, the mem­ber countries are likely to leverage the expansion to advocate for reforms within the United Na­tions (UN) and other global institutions.

There is no doubt that a strong and de­termined Indian presence in a rejuvenated BRICS will ensure it does not become a vehicle of Chinese manoeuvring. India is, in fact, the best in­surance the West can have of China-proofing BRICS. India’s interest in an eq­uitable BRICS expansion, its desire to not let it be perceived as an anti-West grouping, as well as its broader strategic affini­ties with Washington, make it the best guar­antor that BRICS will not evolve into a pole of hostility to the democratic West.

But there is still the broader challenge of global governance. Although BRICS+ has not elaborated on a model of global governance, they are emerging at a time when the future of the in­ternational system that arose in the immediate aftermath of World War II is increasingly being called into question. After two World Wars, nu­merous civil wars, colonial oppression, and the horrors of the Holocaust and Hiroshima, the farsighted statesmen of the mid-1940s decided that liberal internationalism, based on the UN Charter and allied institutions, was the only way to prevent more carnage. Indeed, for over seven decades, that system has largely achieved its goals. It has broadly ensured world peace and prevented a Third World War, although at the cost of shifting many conflicts to the global pe­riphery. And it did not benefit only the developed world; it also ensured decolonisation, promoted development, and found ways to accommodate the voices of newly emerging countries, even if it has not always accommodated their aspirations.

There is increasing concern that these coun­tries have now hit a ‘glass ceiling’ within the international system. Covid-19 inaugurated an era of de-globalisation, with the world embracing isolationism and protec­tionism more enthusiastically than prior to the outbreak. There was a rush to reset global supply chains and raise trade barriers: the demand arose for more protectionism and ‘self-reliance’, for bringing manufacturing and production value chains back home or at least closer to home. All of this consolidated what I see as the four crises that plague the current structures of global governance.

The first is the crisis of legitimacy, a manifestation of how the current struc­tures of global governance have left out a large section of the world’s popula­tion. Consider how the Western European and Others Group (WEOG) in the UN General Assembly (comprising of 28 member countries, including the US, Canada, Australia, and Israel) holds more than 50 per cent of the total voting power. The African Group (54 member countries) from the African continent holds only 13 per cent of the total voting power. Similarly, in the IMF, the com­bined voting power of the US, Japan, Germany, France, and the UK is 38.8 per cent, while the combined voting power of African countries is only 3.2 per cent.

The second is the crisis of sovereignty, where on the one hand, many post-colonial nations cling tightly to their hard-won sovereignty, as do some developed coun­tries like the US. On the other hand, countries in blocs like the European Union (EU) and Africa are much more willing to cede sovereignty in order to gain collec­tive benefits, including bargaining power at international negotiations.

The third is the crisis of the collective, where nations are rushing to cook up alphabet soups from RIC to BRICS and from G20 to G77, while simultaneously many of these nations are at odds with each other bilaterally. As sovereignties were reasserted across the world, and treaties and trade agreements increasingly questioned during the pandemic, multilateralism, the once taken-for-granted mantra of international cooperation was questioned. It was already in danger of being eroded before the pandemic: Britain withdrawing from the EU, and America leaving the landmark Paris climate agreement being glaring examples. More re­cently, this was seen in the failure of the finance ministers of G20 to reach a consensus in fram­ing a joint communiqué, though the final G20 summit did achieve agreement on one.

The fourth is the crisis of identity, which refers to the cultural and economic backlash against globalisation (ironically, a phenom­enon meant to bring us closer together), that has marked much of the period since 2008. May it be the angst of developed countries to­wards economic elites in their country work­ing to benefit countries other than their own, or people resenting cosmopolitanism and herding behind chauvinistic and purportedly ‘more authentic’ variants of nationalism— globalisation is not as cool as it once used to be. David Goodhart captures this dilemma as a bat­tle between the ‘anywheres’ (the globalist elite who can flit from five-star hotel and business-class lounge to international conference and global audience) and the ‘somewhere’ (who are firmly anchored in a particular region, religion, ethnicity and language—the target audience of global populists).

BRICS have demonstrated in their demand for greater clout and in their willingness to explore a smaller grouping to pool in their resources and push for a new order that existing arrangements are no longer adequate. Some observers have seen BRICS as an Alter-West rather than anti-West platform—implying that the grouping will expand the space of interaction by bypassing the Western world and without the participation of Western countries. In essence, each of the BRICS states is free to develop its relations with the US and Europe, without harming its relations with the BRICS states or undermining collective BRICS initiatives. Current and future BRICS members have one thing in common: they reject the right of the US and the EU to call the shots and to impose restrictions on other countries’ foreign policy and economic activities.

It is apparent, however, that even in the original BRICS grouping, all five nations do not see all international issues in the same perspective, largely due to differences in the development models of the five countries.

Trade divides the group. While Brazil and Russia are commodity exporters, China is a commodity importer. In practice, the grouping’s profound asymme­tries—China’s GDP is larger than that of all other members combined—creates informal hierarchies. Geopolitics, too, divides the BRICS countries. China has a position on cyber-security that opposes that of Brazil and India. China and Russia are suspicious of liberal ideas, wary of information technology (IT) and decidedly unsympathetic to democratic dissent; India, Brazil and South Africa are lively democracies. Brazil and South Africa are non-nuclear powers, in con­trast to China, India, and Russia, which boast nuclear arsenals.

India and China disagree on Pakistan’s role in fomenting terrorism and per­haps most seriously, China and India face an ongoing border conflict. Tensions between India and China have surfaced periodically on several fronts, with the most shocking confrontation leading to a loss of 20 Indian soldiers in Ladakh’s Galwan Valley clash in 2020.

The credibility of the grouping has also been threatened by political instabil­ity within the BRICS nations. A little more than a year ago, Brazil’s infamously polarising President Jair Bolsonaro lost elections and was replaced by the more conciliatory Lula da Silva. Yet, most analysts expect Brazil’s economic situation to worsen in the course of 2023, a trend that will likely increase public discon­tent. As long as Brazil’s “lost decade” continues—GDP per capita has been all but stagnant since 2012—the anti-incumbency dynamic will remain dominant, almost inevitably leading to political instability.

A strong and determined Indian presence in a rejuvenated BRICS will ensure it does not become a vehicle of Chinese manoeuvring. India is the best insurance the West can have of China-proofing BRICS

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In South Africa, we are seeing what is essentially a one-dominant party democracy under President Cyril Ramaphosa, who came to power with a widespread hope that his administration would be able to rapidly deliver on his promise to revitalise the national economy and restore ethical business practices. Even as he started with an inquiry into high-level corruption and state capture, he has now himself become embroiled in multiple scandals that almost led to his own impeachment. The economic prospects are dwindling, too. Reeling from a debt crisis, the country’s GDP was only projected to grow 1.1 per cent in 2023, and 1.6 per cent in 2024. Moreover, there is a significant risk that the ongoing energy crisis will lead to a recession in the not-too-distant future.

With the new BRICS members too, come new conflicts. Egypt and Ethiopia are fiercely at loggerheads over Nile waters, while Iran and Saudi Arabia are regional foes—notwithstanding their Beijing-brokered attempt to make peace. The bloodshed seen in the wake of the Israel-Hamas conflict has created more complexities that situate all Arab states in a tinderbox of a neighbourhood.

Given these differences, is it then possible for the members of BRICS to truly adopt a common view on global macro-economics, development aid and international resource transfers?

IN 2015, I WAS PART OF THE FIRST parliamentary forum in Moscow of the BRICS countries, and I found myself in in­tense conversation with my counterpart, the chair of the Foreign Affairs Committee of the Chinese National People’s Congress. Mean­while, South African and Brazilian parliamen­tarians were swaying to Russian music before everyone went out on a cruise of the Moskva river. Before the meeting opened, many won­dered whether the five parliaments could pos­sibly find common ground. I can tell you from personal experience that the parliamentarians all got along very well indeed, and it was clear to everyone there that we have great potential for dialogue and more.

Add to this a new set of values that looks at establishing institutions of global governance on newer and fairer terms, and BRICS may well serve as the indispensable instrument to pave the way ahead for a new system of global gover­nance. But these countries face challenges not always addressed adequately by institutions that were designed by and remain dominated by the US-led West.

For instance, BRICS has established a New Development Bank (NDB), headquartered in Shanghai and initially headed by one of India’s most eminent private-sector bankers, now suc­ceeded by a Chinese. NDB, which promises to become a major regional development bank— the first one without OECD (Organisation for Economic Co-operation and Development) countries in its leadership—has the express purpose of addressing the infrastructure needs of member states.

NDB demonstrates that if the BRICS coun­tries are not given their due at the existing global forums, such as the World Bank and UN, they can consider very realistically the option of by­passing them and planting the seeds of a new order. But do they all share the same set of com­mitments and priorities? China’s major prior­ity remains the 57-member Asian Infrastructure and Investment Bank (AIIB), of which India and Russia are the second and third-largest stakehold­ers respectively (and to which Brazil and South Africa also belong). Since China will be the prin­cipal contributor to both institutions, is there any doubt as to which it will do more to bankroll?

This is also where we need to deconstruct the growing clamour around “de-dollarisa­tion”. Leading up to the Johannesburg summit, there was speculation that, in a move towards de-dollarisation, the bloc would announce the setting up of a common cur­rency. But they settled for a less ambitious goal of encouraging trade in local currencies. Russia’s 2024 BRICS presidency is set to focus primarily on using local currencies and payment systems, steered by discussions among finance ministries and central bank governors.

In theory, a BRICS common currency would shield the bloc from the perils of dollar hegemony. In practice, that project will remain a non-starter because of both politics and economics. It’s inconceivable that member countries, not least India, would be willing to give up their monetary policy autonomy and become hostage to a common currency that would be vulnerable to instability anywhere in the bloc. Because of its outsized economic muscle, China would easily dominate BRICS, and ipso facto, the common currency’s fortunes. No matter the rhetoric about a new world order, it will be ironic if, to escape the dollar’s dominance, BRICS members succumb to the alternative of an authoritarian regime with a dubious reputation for institutional integrity, transparency, and rule of law.

The second-best option chosen by BRICS—trading in local currencies—is a less formidable way forward, but not an easy one. Local currency trade works best if bilateral trade between countries is roughly balanced. But if bilateral trade is structurally imbalanced, the surplus country would accumulate the trading partner’s currency, which raises the ticklish question of how to settle that. If it has to be settled in dollars or another hard currency, the benefits of local-currency trade will be largely neutralised. We seem to have hit that con­tingency with regard to paying for oil imports from Russia in rupees. Thus, if the BRICS countries want to avoid the dollar, the most likely alternative is the yuan because of China’s vast trade footprint. Acquiescing in a yuan-dominated system as a price for escaping from a dollar-dominated system is unacceptable, and must be unequivocally removed off the table.

But sporadic conflict and turmoil aside, BRICS remains an alternative forum that can stand up to the dominant worldview of established economies, the prin­cipal ones of which merely happen to still dominate the global system because they were the founders of the post-World War II global order agreed at Bretton Woods and San Francisco. The accusation that the West is arrogant towards the needs of the Global South is serious. It cannot be answered by offering “value-based partnerships” and a “rules-based” multilateralism when the interest of BRICS is focused on changing those rules in global finance, trade, and other standard-setting procedures. After all, the excluded countries are all too aware that you are either at the table, or on the menu. They want nothing less than a seat at the high table, and an equal role in being rule-makers and not just rule-takers.

The BRICS nations might not have mattered in 1945, but this is 2023, and to ignore the BRICS is to ignore the turn of history. The story of BRICS is not merely one of a group of states claiming a greater share of global power—it is also an effort to change the very underlying principles on which the global order is founded. The BRICS+ countries have seized their geopolitical moment and called for a united stand of emerging and developing countries against a world order and practice of international politics that does not correspond to their needs and necessities. Russia’s transgres­sions in Ukraine are seen as no different from the US’ in Iraq (and now Israel’s in Gaza). The signs are clear that the Global South is calling for a new form of open and inclusive multilateral coop­eration overlooking the political character and conduct of the partners.

It is important to note that countries like Brazil and India— unlike, say, Germany and Japan a century ago—are not seeking to overturn the world order but to reform it, and perhaps there are lessons for the advanced West to take from their approach to seeking redress within the broad framework rather than destabilising the frame­work itself. (Whether the same is true of Putin’s Russia is less certain.) All that most of the BRICS countries want is a place at the high table. Bar­ring that, they have little choice but to build their own table, in their image and in a different mould, channelling global relations through different routes than before.

What the emerging powers are doing is not withdrawing from the world order as much as calling for a new design for global order. What that might mean for the world order estab­lished in 1945 is anybody’s guess. But the signs point to the need to take BRICS seriously and accommodate the global system to this impor­tant new entrant in world affairs. The challeng­es and opportunities presented by the BRICS+ expansion will test BRICS’ cohesion and effec­tiveness. Its ability to remain a credible force for reshaping global governance will depend on its capacity to forge consensus among its diverse members. The BRICS space can be developed as a tool for diversifying the world and moving away from Western domination towards a far more genuinely multi-polar order.

(The author gratefully acknowledges the assistance of John Koshy and Armaan Mathur in the preparation of this essay)

About The Author

Shashi Tharoor

Shashi Tharoor is a Congress MP. He is the author of, among other titles, The Struggle for India’s Soul: Nationalism and the Fate of Democracy and Ambedkar: A Life

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