Diverse concerns on trade, investment among participants at Brasilia summits.
The reality of shifting global alignments, both political and economic, is opening partnerships in the India-Brazil-South Africa (Ibsa) and the Brazil-Russia-India-China (Bric) summits taking place in the Brazilian capital over the next couple of days, like never before.
Prime Minister Manmohan Singh, always a reluctant participant in groupings which have an affinity to alphabet soup, is in Brasilia after concluding a four-day trip to Washington DC. However, all the signs are that this time, India is a much more enthusiastic player in South-South cooperation, whose beginnings are often credited to Jawaharlal Nehru.
The reason is not far to see. The four emerging Bric economies are not only in the act of living up to the Goldman Sachs’ prediction that by 2050 they will be the world’s richest entity. In addition, China is increasingly acknowledged as the world’s second most powerful country, while Russia, largely a supplier of raw materials worldwide, remains a superpower in terms of the size of its nuclear arsenal.
In fact, India, Brazil and South Africa’s deliberations in Brasilia will be buoyed by the fact that trade between their three countries grew from $2.6 billion in 2002 to $11.9 billion in 2009.
Moreover, all the Ibsa/Bric countries have another thing in common. They emerged from the global recession in much better shape than their counterparts in the developed world.
However, talk of remodelling and restructuring global financial institutions at Bric, a major source of discussion at Yekaterinburg in Russia last summer, is unlikely to go very far, for the same reason: The global crash is mostly over and nobody wants to rock the boat again.
Moreover, India is not likely to be too enthusiastic about joining the Chinese call to replace the US dollar as the world’s reserve currency, because it believes – just as the US does for its own trade reasons — that a more balanced yuan would materially affect Sino-Indian trade, currently pegged at $66 billion but significantly in Beijing’s favour.
Meanwhile, Iran – along with Haiti and West Asia – is on Bric’s non-economic agenda and here, too, Delhi has already shown signs of straying from the pro-US line of sanctions on Iran. Last week, Foreign Secretary Nirupama Rao announced that India was not in favour of sanctions because these tend to impact most on common people.
But, perhaps the most important factor in Delhi’s return, temporary or otherwise, to the revamped South-South cooperation space is the fact that from January 2011, India will more than likely be elected as a non-permanent member of the United Nations’ Security Council for two years.
In anticipation, Delhi is cosying up to old friends it had abandoned in the recent past such as Iran, and enhance its friendships with South Africa and Brazil, acknowledged as lead players in their respective continents. Brazil is already a member of the G-4, a loose grouping of nations (besides India and Brazil, Germany and Japan) jointly bidding for permanent seats to the UN Security Council.And, despite the protestations of the foreign office, India has been persuaded to water down its pro-US leanings. There is the fact that the Obama administration is not such an enthusiastic supporter of Delhi’s foreign policy, especially on Pakistan and Afghanistan, as was the Bush administration,
But, it’s not as if India wants Ibsa and Bric to become a modern-day version of the non-aligned movement. Indian officials were reluctant to speak on record, but said these groups should remain focused on enhancing trade and investment if they wanted to become a credible alternative to the developed world.
Roberto Jaguaribe, the undersecretary of political affairs at Brazil’s foreign ministry, was quoted by Reuters as saying, “Don’t expect Bric to make bombastic or revolutionary proposals, because it’s not going to happen.”
China’s Hu Jintao, who has aggressively leveraged his country’s economic growth to expand political influence in traditionally non-aligned regions like Africa, Latin and South America and Asia, will in fact use his presence in Brasilia to sign a separate strategic pact with Brazil, already a major supplier of iron ore and soyabeans to China.
China certainly doesn’t want Bric to become a challenge to US dominance. “We come together seeking mutual benefit, rather than confrontation with other third parties,” said Chinese vice-foreign minister Cui Tiankai.
Other diginatories which are attending the meeting include heads of the PSUs and state energy secretaries
Disinvestment Secretary Johri, however, says half of these stocks are in the metals and mining segment, markets for which are down globally