Context: Over two decades, BRICS has evolved from a grouping of five emerging economies into a major platform representing the interests of the Global South.
- Its growing membership and relevance reflect dissatisfaction among developing countries with the limitations of existing global governance institutions.
Why BRICS Matters to the Global South
- Global governance deficit: The United Nations (UN) is increasingly criticised for its inability to prevent conflicts and protect smaller states; the World Trade Organization (WTO) faces institutional paralysis, while the World Bank (WB) and International Monetary Fund (IMF) are seen as insufficient for the developmental needs of emerging economies.
- Alternative platform: BRICS provides developing countries a forum to exchange perspectives, articulate common concerns and coordinate positions on global economic and political issues.
- Growing representation: Its appeal lies less in ideological uniformity and more in providing a collective platform for countries that have historically had limited influence over global institutions.
BRICS: A Heterogeneous Grouping
- Political diversity: BRICS includes democracies, authoritarian systems, monarchies and theocracies, making political homogeneity neither its basis nor its objective.
- Economic asymmetry: China's nominal Gross Domestic Product (GDP), at around $20 trillion in 2025, was larger than the combined GDP of the other 10 members, estimated at around $14 trillion.
- Civilisational diversity: Members do not share a common historical, linguistic or cultural heritage.
- Therefore, BRICS should be assessed not by the degree of internal similarity but by the strategic interests and shared objectives that enable cooperation despite differences.
BRICS’ Normative Orientation
- Reformist, not revolutionary: BRICS does not formally seek to replace the existing international order but advocates its reform and democratisation.
- Non-Western, not anti-Western: It positions itself as an alternative voice to Western dominance rather than an explicitly anti-Western bloc.
- Multipolarity: It supports a more multipolar international system in which power is distributed among multiple centres.
- Sovereignty and non-interference: BRICS emphasises sovereign equality, non-interference in domestic affairs and respect for diverse political systems.
- Global South multilateralism: It seeks greater collective agency for developing countries in international decision-making.
Financial Architecture: NDB and CRA
New Development Bank
- The New Development Bank (NDB) has financed around 120 sustainable infrastructure projects worth approximately $39 billion and has expanded membership beyond the original BRICS countries.
- Around 30% of its recent financing has been committed in local currencies, reducing dependence on the U.S. dollar.
- A major distinction from World Bank and IMF lending is that NDB financing is not generally accompanied by political conditionalities.
- Although its lending remains much smaller than that of the World Bank, the NDB provides the Global South with an additional source of development finance.
Contingent Reserve Arrangement
- The Contingent Reserve Arrangement (CRA) was established as a financial safety mechanism to provide liquidity support to members facing external financial pressures.
- Together, the NDB and CRA represent BRICS’ effort to create alternative financial institutions and reduce dependence on traditional Western-led financial architecture.
Expanding Intra-BRICS Trade
- BRICS accounts for over 20% of global trade, amounting to roughly $10 trillion.
- According to the United Nations Conference on Trade and Development (UNCTAD), intra-BRICS trade increased nearly 13-fold, from $84 billion in 2003 to $1.17 trillion in 2024.
- This expansion has been supported by lower tariffs, complementary resource endowments and efforts to reduce supply-chain constraints among member countries.
Move Towards Local-Currency Trade
- BRICS members are increasingly experimenting with settling bilateral trade in local currencies, including Russia–China, China–Brazil, India–Russia and India–United Arab Emirates trade.
- Local-currency settlement can reduce exposure to U.S. dollar liquidity shortages and shocks arising from U.S. monetary policy.
- This has intensified discussions around de-dollarisation and the possibility of a BRICS currency.
- However, a common BRICS currency is unlikely in the near term, given differences in economic structures, monetary policies and financial systems.
BRICS and India’s Strategic Role
- BRICS provides India an opportunity to position itself as a leading voice of the Global South while simultaneously acting as a bridge between developing economies and the West.
- India's ability to bring major leaders together provides diplomatic space for addressing shared developmental and geopolitical concerns.
- The immediate challenge is to secure consensus-based outcomes and a joint declaration despite significant differences among members.
Emerging Priorities of the 2026 Summit
- The summit is expected to emphasise developmental cooperation and technological collaboration.
- Its broader strategic significance will depend on whether BRICS can contribute to mechanisms for addressing major conflicts, particularly the Russia–Ukraine war and tensions involving Iran.
- BRICS possesses considerable economic and diplomatic weight, but its effectiveness ultimately depends on political intent and members’ willingness to convert collective capacity into concrete outcomes.
Significance for India
- BRICS offers India strategic autonomy, Global South leadership, diversified economic partnerships and greater negotiating space in global institutions.
- At the same time, India's interests require balancing BRICS engagement with its partnerships with the United States, Europe and other major powers.
- Hence, BRICS should be viewed as an important instrument of multi-alignment and global governance reform, rather than as an alternative to India's wider strategic partnerships.
