On 26 March 2013, the “Big Picture” on India’s parliamentary television station Rajya Sabha TV discussed the BRICS summit in Durban (26-7 March 2013): ‘Guests: M K Bhadrakumar (Former Ambassador and Foreign Policy analyst) ; Mohan Guruswamy (Distinguished Fellow, Observer Research Foundation) ; Nandan Unnikrishnan (Senior Journalist and Senior Fellow, Observer Research Foundation) ; Pramit Pal Chaudhary (Foreign Affairs Editor, Hindustan Times) – Anchor: Girish Nikam’.
The Associated Press reports as follows: ‘Leaders of five of the world’s emerging economic powers agreed Wednesday [, 27 March] to create a development bank to help fund their $4.5 trillion infrastructure plans _ a direct challenge to the World Bank that they accuse of Western bias. But the rulers of Brazil, Russia, India, China and South Africa _known as the BRICS group _were unable to agree on some basic issues. Foreign Minister Pravin Gordhan of South Africa told reporters that there were “different views” about how much capital such a bank would need. He said $50 billion had been mentioned, an amount conference officials said would be seed capital shared equally between the five countries. Finance ministers had discussed basing contributions on a country’s wealth, but then felt it would leave economic giant China, with the world’s No. 2 economy, in an untenably dominant position, according to conference officials, who spoke on condition of anonymity because they are not authorized to speak to reporters. Analysts said there was little doubt that China, with the world’s largest reserves of foreign exchange, inevitably would be dominant, perhaps in much the same way that the United States and Europe dominate the World Bank and the International Monetary Fund. The development bank would be the first institution of the informal BRICS forum which was started in 2009 amid the economic meltdown to chart a new and more equitable world economic order. South Africa joined two years ago. “Russia supports the creation of this financial institution,” President Vladimir Putin said Wednesday, but he cautioned “we believe that, if it is created, then it must work on market principles only and support the businesses of all our countries.” But his deputy foreign minister, Sergey A. Ryabkov, implied the announcement was premature: “We are not contesting the idea, we support it, we favor it, but we are urging everyone to be serious enough to make further efforts in order to create the right foundation.” They were at a stage where “the devil is in the details,” he added. Inability to agree on fine points about the bank, first mooted a year ago when finance ministers were tasked with exploring its feasibility, highlighted the differences between the bloc that is made up of democracies and autocracies, diverse foreign policies and structurally different economies. But at the fifth BRICS summit, its first in South Africa at the coastal resort of Durban, leaders pointed to their shared histories and aims: South Africa, very much the junior partner with a much smaller economy, has a decades-old relationship with China and Russia since they funded and armed anti-apartheid liberation movements; it shares a history of colonization with Brazil, a country that was the destination for more African slaves than any other; and with India as Mahatma Gandhi lived in South Africa for more than 20 years and developed his political activism here as he faced discrimination from a white minority government. South African President Jacob Zuma, whose country is lobbying to be home to the BRICS development bank, said the formal negotiations to establish the institution were “based on our own considerable infrastructure needs, which amount to about $4.5 trillion U.S. dollars over the next five years.” The bank will also cooperate with other emerging market countries and developing economies. Zuma said the bank also will establish a “BRICS contingent reserve arrangement,” a pool of money to cushion member states against any future economic shocks and further lessen their dependence on Western institutions. Both those aims challenge the traditional roles of the World Bank and the International Monetary Fund, institutions that in their 50-year life have been dominated by the United States and Europe’.
Will Durban spell the end of the era of Breton Woods??? The AP report continues that ‘Brazil’s President Dilma Rousseff said BRICS has confounded its critics. “Even the most skeptical voices do recognize the contribution the BRICS bloc of countries has provided in the field of international economics,” she said. Even the World Bank has said that global growth over the past few years and for the foreseeable future is being driven by the bloc. Rousseff said it is time multilateral institutions like the IMF and World Bank become more democratic to clearly reflect the growing influence of developing countries’. If nothing else, these developments highlight the power of words, as the mere concept of BRIC (or BRICS, as it is now spelt and understood) was actually coined by the Goldman Sachs economist Jim O’Neill, lumping together far-flung countries with apparently similar economic outlooks. I wonder what will happen to the MIST configuration in some years’ time???
 “BRICS plan development bank to fund infrastructure”.