NEWS –  India has extended a warm welcome to Egypt, Iran, UAE, Saudi Arabia, and Ethiopia as they join the BRICS group. This inclusion was marked by their participation in a significant meeting hosted by Russia.

BRICS

Definition and Membership

• BRICS: An acronym for Brazil, Russia, India, China, and South Africa.
• Nature: Not a formal organization but an annual summit.
• Rotation: Chairmanship rotates annually among the members.

Economic Significance

• Population: Accounts for about 40% of the world’s population.
• GDP: Represents about 30% of the global GDP.
• Objective: Aims to be a critical economic engine and emerging investment market.

Objectives of BRICS

• Cooperation: Deepening, broadening, and intensifying cooperation within the group and among individual countries.
• Development: Focus on sustainable, equitable, and mutually beneficial development.
• Economic Relations: Building relations based on economic strengths and minimizing competition.
• Political-Diplomatic Entity: Beyond financial reform, BRICS aims to be a significant political-diplomatic entity.

Financial Architecture of BRICS

New Development Bank (NDB)

• Headquarters: Shanghai
• Establishment: Signed during the Sixth BRICS Summit in Fortaleza (2014).
• Key Areas: Clean energy, transport infrastructure, irrigation, sustainable urban development, and economic cooperation.

Contingent Reserve Arrangement (CRA)

• Purpose: To provide short-term liquidity support through currency swaps.
• Objective: Mitigate Balance of Payments (BOP) crises and strengthen financial stability.

Initial Resources: Committed resources amounting to one hundred billion dollars