Building Prospects for Closer Economic Integration
By Srimal Fernando Global Editor
The weekend of October 15th saw the eighth BRICS summit taking place in the western Indian state of Goa. At this historic summit heads of state and leaders of the world's five major emerging economies comprising Brazil, Russia, India, China and South Africa met on 15 and 16 October 2016 to boost trade, cultural exchange and economic partnerships.
Group Photograph Front row: BRICS Leaders (l-r) Michel Temer of Brazil, Vladimir Putin of Russia, Narendra Modi of India, Xi Jinping of China and Jacob Zuma of South Africa.
Second row: BIMSTEC leaders ( l-r): Nepali Prime Minister Pushpa Kamal Dahal, Bhutanese Prime Minister Tshering Tobgay, Sri Lankan President Maithripala Sirisena, Bangladeshi Prime Minister Sheikh Hasina, Myanmar's State Counsellor Aung San Suu Kyi and Virasakdi Futrakul, Vice Minister for Foreign Affairs of Thailand
This year's summit in India is themed "Building Responsive, Inclusive and Collective Solutions." The five nations BRICS grouping have a combined nominal GDP of US$16 trillion and collectively accounts for 23 percent of global Gross national product (GNP), and 40 percent, 3.6 billion people, of the world’s population (BRICS, Ministry of External Relations Brazil 2015).
Over the past ten years, the Gross domestic product (GDP) of the BRICS member countries have grown at a modest pace and it is envisaged that this growth is likely to continue. Top economic policymakers predict a 5 percent average economic growth for the BRICS nations for the coming year. At the global level, the BRICS member nations have played a remarkable role in increasing the agricultural output to 45 percent, and share of global trade to 17 percent (Russia's BRICS Presidency 2015).
On the inaugural day of the eighth BRICS summit in Goa Hon Narendra Modi, the Indian Prime Minister and the current Chair of BRICS welcomed the Heads of States and leaders by saying “I join 1.25 billion Indians in once again extending a very warm welcome to all of you in Goa for the eighth (8th) BRICS Summit”. The 2016 BRICS leaders began the summit in Goa aiming to strengthen ties between the geographically distant but economically powerful countries.
On the opening day of the BRICS summit in India the South African President Jacob Zuma said, “I wish to congratulate our Chair and gracious host, Prime Minister Modi, for his leadership towards yet another set of milestone achievements for our grouping today.”
As host of the Summit Prime Minister Narendra Modi invited leaders from BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation), of which India is a member. Addressing the seven-nation grouping of BIMSTEC, Modi focussed on economic development and propserity.
'With 1.5 billion people and a combined GDP of $2.5 trillion, the countries of BIMSTEC have shared aspirations for growth, development, commerce, and technology. Their quest for economic prosperity can shape the agenda for building economic partnerships with BRICS,' the Prime Minister said.
India and Russia have a long history dating back to the Soviet era and has seen one of the most cordial and productive relationships throughout the post-Cold War period and they have decided to diversify and deepen ties. During Russian President Vladimir Putin’s visit to India to attend the BRICS summit, India and Russia signed sixteen Memoranda of Understanding (MoU) and are planning to finalise deals worth almost $8 billion. Further, both countries are preparing to set up a $1 billion 'Russian Indian Investment Fund'.
At its 6th summit, BRICS established the New Development Bank (NDB), formerly referred to as the BRICS Development Bank. The aim of the New Development Bank is financing infrastructure and sustainable development projects in the BRICS and other developing countries.
“With agreements, trade between Brazil and India can triple in a few years,” said the Brazilian President Michel Temer, tweeting on social media after arriving in Goa for the BRICS summit.
Following Chinese President Xi Jinping’s attendance of the eighth BRICS Summit in India, both nations will open a new chapter in Indo - China ties and this higher level of diplomatic engagement will lead to a totally new paradigm of cooperation. In Goa, Chinese President Xi Jinping stated, “The potential and strength of BRICS countries in terms of resources, market and labour forces have remained unchanged.” “The long term ... of BRICS development is still positive.”
The 9th BRICS summit will be held in China in 2017.