(Corrects fourth paragraph, first sentence to remove reference to China and India as the only neighbour members of the BRICS. Replaces to refer to China and India as most populous.) (Repeats with no changes to text.) (The author is a Reuters Breakingviews columnist. The opinions expressed are her own.)
By Una Galani
MUMBAI, Sept 4 (Reuters Breakingviews) - The future of the BRICS looks toxic. China and India stepped back from a border dispute just in time for a summit of the bloc of large emerging market countries. That helps Chinese President Xi Jinping keep up appearances ahead of a crucial political reshuffle. But the unusual tensions between the two Asian giants suggest the three-day gathering underway could be a last hurrah.
Brazil, Russia, India, China and South Africa are united in their opposition of a Western-led global order. So Xi’s fresh call for an open world economy is easy for members to get behind, amid a rising tide of protectionism in developed markets to which exports flow. Since starting to group together roughly a decade ago, the BRICS have wrung concessions from a global climate change agreement, and have improved their position in international bodies such as the International Monetary Fund.
Beyond that, the BRICS, which account for nearly 29 percent of global GDP at purchasing power parity, share less in common than other blocs. The Group of Seven (G7) are all rich, industrialised nations with broadly similar democratic politics. The Association of Southeast Asian Nations (ASEAN), and the Gulf Cooperation Council are composed of countries that at least live shoulder-to-shoulder. In everything from history to demographics, politics, and resource dependence, the BRICS vary enormously. The huge differences have rightly seen the acronym panned as a “bloody ridiculous investment concept”.
Now a potentially fatal problem is heightening distrust between its most populous members. The source of friction is Beijing’s “Belt and Road” initiative, an ambitious global infrastructure push. New Delhi sees it as a debt-fuelled attempt to buy influence and, in places, a threat to its sovereignty. Indeed, construction of a road by China led to the recent Indo-Sino border spat. A separate project runs through Pakistan and Kashmir, another disputed region.
Ultimately, the sums being invested in Xi’s set piece dwarfs China’s commitment to things like the New Development Bank, a BRICS-backed lender set up two years ago to rival the World Bank. That does not mean there will not be more summits and self-important communiqués. But as China and India march in opposite directions, the BRICS are likely fade further into irrelevance.
On Twitter twitter.com/ugalani
- The BRICS group of countries must promote trade liberalization and an open world economy, Chinese President Xi Jinping said on Sept. 3.
- The group of countries - Brazil, Russia, India, China and South Africa - should explore ways to innovate economically, Xi said at the start of the three-day BRICS summit in the southeastern Chinese city of Xiamen.
- On Aug. 28, India and China agreed to end a military standoff at the Doklam plateau near the borders of India, China, and India’s ally Bhutan. The more than two-month long confrontation was the longest and most serious in decades along the disputed Himalayan border.
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Editing by Quentin Webb and Katrina Hamlin