NEW DELHI (NNN-XINHUA) -- India expects the Fourth BRICS summit which begins here Wednesday to add more weight to the emerging group as it is taking place amid the world economic downturn, a senior Indian official says.
Sudhir Vyas, the Secretary for Economic Relations at the Indian External Affairs Ministry, told Xinhua Tuesday: "The BRICS countries today present an opportunity as new growth poles in a multi-polar world, as demonstrated during the global economic crisis when they played a vital role that helped the world economy emerge from the shadows of the crisis."
At a meeting of a BRICS think tank early this month, India had proposed to establish a BRICS development bank as the five countries -- Brazil, Russia, India, China and South Africa -- have fast growing economies and have accumulated considerable foreign reserves.
The rationale behind the proposal is to reduce dependence on the United States and European development aid which is usually dispensed with strings attached, and put development projects in BRICS countries as a priority, therefore promoting the reform of the international financial system, and earn more space for developing countries.
However, the much-touted idea of a BRICS Development Bank or South-South Bank still remains a work in progress and will take more time to come to fruition. "It's still very much a thought that needs to be developed," admits Vyas.
Noting that two pacts for promoting intra-BRICS trade will be signed at the two-day fourth summit of their leaders here Thursday, he said the pacts were expected to scale up intra-BRICS trade which had been growing at a rate of 28 percent over the last few years.
R.V. Kanoria, the president of India's second largest industry association, the Federation of Indian Chambers of Commerce and Industry (FICCI), told Xinhua that the five countries together constituted 4.5 trillion USD of trade while the intra-BRICS trade was 230 billion USD, and therefore there was much room for intra-BRICS trade to grow.
"if you look at BRICS in the true sense, the five economies have strength in what is relevant as a whole, each one for their own reason."
He pointed out that China is a manufacturing hub of the world while India is a service hub especially strong in IT and other services. South America has a huge amount of natural mineral wealth and Brazil is largely an agrarian economy which has a tremendous amount of agricultural possibilities, including that of bio-fuels where Brazil is a leader.
"So, we need to concentrate on engaging in a more meaningful manner between the BRICS countries," said Kanoria.
"BRICS in Delhi is a very useful forum that will help these countries not only to increase trade between themselves but also to share these complementary best practices."
Vyas said the summit would focus on a cluster of global issues, including finding ways of sustainable recovery from the festering global downturn, reforms of international financial institutions, the UN reforms, inclusive growth, food security and energy security.
The BRICS report on synergies and complementarities between the economies of the five countries, which will serve as a reference guide for promoting trade and investment, will be released in the presence of the leaders.
"If you look at the UN or IMF or any other such institutions, they were based on the economic equations or the power equations of post-World War II. But in the last 60 years there has been dramatic change in the shifting economic power but that is not reflected in these organizations,"said Kanoria.
He said the constituency of UN or UNSC or IMF requires undergoing a change. The shift will happen since the economic power will shift because the population and purchasing power is in Asia and in the future, with Latin America and Africa.
However, "As EU took 47 years to form and the transition from GAT to WTO took another 50 years to happen, which is perhaps the only global organization that grants you the status of one vote for membership. So, things will happen with consensus in their own time," he said.
Indian English daily Economic Times even suggested the BRICS nations in New Delhi should initiate discussions about moving to a trade system that uses the currencies of the five nations only in order to reduce dependence on major traded currencies like the U.S. dollar and the euro, and insulate our currencies to some extent from shocks in the United States and Europe.
Besides economic cooperation, Indian strategic analyst, retired Major General Ramesh Chopra noted that it is inevitable the political issues would be discussed though initially the BRICS were more of an economic forum.
"if you recall the Sanya summit in China last year, the joint declaration did discuss pressing political and security issues like Libya, terrorism, non-traditional threats such as nuclear energy, food security, climate change, even the role of G-2," he told Xinhua.
Sudhir Vyas said Syria and Iran will be discussed. Indian media reports citing informed sources suggested that there could be a broader formulation about opposing external interference in internal affairs of other countries, which will be reflected in the Delhi Declaration, the final outcome document of the summit.
After taking part in discussions of the think tank meeting ahead of the BRICS summit, retired Major General Ramesh Chopra commented, "there is perception that BRICS only talks, they don' t do anything. Now they will try to get them implemented."
"This way the BRICS will become a more important body," he said. -- NNN-XINHUA
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