Follow us on:   

India underlines commitment to BRICS
March 22, 2013, 8:08 am

[Getty Images]

Manmohan Singh, India’s prime minister (left) and South African President Jacob Zuma will meet at the BRICS Summit next week [Getty Images]

Notwithstanding the domestic political crisis at home, Manmohan Singh, India’s prime minister, accompanied by his key ministers – finance & commerce and industry will visit the South African city of Durban from March 25-28 for the fifth BRICS Summit.

Besides, finance minister P Chidambaram and commerce & industry minister Anand Sharma, the prime minister’s entourage will also include national security adviser Shivshankar Menon and senior officials of Mr Singh’s office and ministry of external affairs.

This underlines the importance of BRICS for India, which views the grouping as representing a new constellation of economic growth in the world, said informed sources.

Other countries including Egypt and Turkey have already shown interest to join BRICS. This shows that financial capitals of the world are shifting to emerging powers.

Last week – New Delhi hosted a first of its kind conference – The Growth Net – a conference of emerging economies.

The conference drew speakers and delegates from Latin America and Africa and was inaugurated by India’s external affairs minister Salman Khurshid.

Menon was a key note speaker at the meet, which was also addressed by planning commission deputy chairman Montek Singh Ahluwalia. The Growth Net was a kind of a prelude to the BRICS Summit.

The Indian prime minister will also get the opportunity to hold dialogue with the new Chinese President Xi Jinping and Russian President Vladimir Putin on the sidelines of the BRICS summit.

This will be first meeting between Mr Singh and the new Chinese president. Other African leaders will also be meeting Singh on the sidelines of Summit.

Singh will underline India’s support for development initiatives for Africa during his meeting with African leaders.

India is viewed as a benign presence in Africa, said official sources, adding New Delhi is a natural partner for the African continent.

India has several Line of Credit and grant in assistance programmes in Africa helping to boost capacity building in the continent, which is now the new economic growth story amid the global economic crisis.

BRICS represent 26 per cent of the world’s geographical area, and 43 per cent of the world’s population. The bloc controls 17 per cent of global trade and recipient of 11 per cent of global FDI.

The bloc also controls 25 per cent of global GDP in terms of purchasing power parity and one fifth of global nominal GDP.

Setting up the BRICS Development Bank will be key agenda at the Summit, besides viability of trading in local currency.

India mooted the idea of setting up of a BRICS-led South-South Development Bank, mainly funded and managed by BRICS countries to recycle surpluses into investment in developing countries for infrastructure and sustainable development project.

The first meeting of Development Banks was hosted by Brazil in April 2010. EXIM (Export Import) Bank participated from India in this BRICS process.

A pact laying the foundation of BRICS Inter-Bank Cooperation Mechanism was signed at the Meeting. Following up on the pact, BRICS Development Banks signed a framework agreement on ‘Financial Cooperation within the BRICS Inter-bank Cooperation Mechanism’.

The framework agreement envisaged grant of credits in local currencies and cooperation in capital markets and other financial services including access to capital and financial markets and treasury transactions in member countries and issuing local currency bonds in BRICS markets.

Development Banks are now pursuing the cooperation further. A Technical Meeting was hosted by EXIM Bank in the Southern Indian state of Kerala on February 15-16 last year to finalise texts of Master Agreement on Extending Credit Facility in Local Currencies, and BRICS Multilateral Letter of Credit Confirmation Facility Agreement, which were signed at the Delhi Summit.

Dipanjan Roy Chaudhury for The BRICS Post

Leave a Reply

Your email address will not be published. Required fields are marked *

Anti-Spam * Time limit is exhausted. Please reload the CAPTCHA.