BRICS NATIONS COMMITEE:ROLE & EXSISTANCE

SUBMITTED BY: RAHUL MEHTA RAVNEET SINGH MANPREET SINGH SAINI RISHABHPREET SINGH CHEEMA HITESH MALHOTRA

SUBMITTED TO: CA,ATINDER PAL SINGH (MANAGEMENT FACULTY, PCTE GROUPS OF INSTITUTION)

OVERVIEW:

BRICS is the title of an association of leading emerging economies, arising out of the inclusion of South Africa into the BRIC group in 2010. As of 2012, the group's five members are Brazil, Russia, India, China and South Africa.

With the possible exception of Russia, the BRICS members are all developing or newly industrialised countries, but they are distinguished by their large, fast-growing economies and significant influence on regional and global affairs.

As of 2012, the five BRICS countries represent almost 3 billion people, with a combined nominal GDP of US $ 13.7 trillion, and an estimated US $ 4 trillion in combined foreign reserves.

Presently, India holds the chair of the BRICS group.

some analysts have highlighted potential divisions and weaknesses in the grouping, such as India and China's disagreements over Tibetan and border issues, the failure of the BRICS to establish a World Bank-analogue development agency, and disputes between the members over UN Security Council reform

HISTORY:

The foreign ministers of the initial four BRIC states (Brazil, Russia, India, and China) met in New York City in September 2006, beginning a series of high-level meetings. A full-scale diplomatic meeting was held in Yekaterinburg, Russia, on May 16, 2008 The BRIC [Brazil, Russia, India and China] idea was first conceived in 2001 and The acronym BRIC was first used in 2001 by Goldman Sachs in their Global Economics Paper No. 66, "The World Needs Better Economic BRICs".

First BRIC SUMMIT:

The BRIC grouping's first formal summit commenced in Yekaterinburg on June 16, 2009, with Luiz Incio Lula da Silva, Dmitry Medvedev, Manmohan Singh, and Hu Jintao, the respective leaders of Brazil, Russia, India and China, all attending The summit's focus was on means of improving the global economic situation and reforming financial institutions, and discussed how the four countries could better co-operate in the future.

There was further discussion of ways that developing countries, such as the BRIC members, could become more involved in global affairs.

ENTRY OF SOUTH AFRICA:

In 2010, South Africa began efforts to join the BRIC grouping, and the process for its formal admission began in August of that year.

South Africa officially became a member nation on December 24, 2010, after being formally invited by the BRIC countries to join the group.

The group was renamed BRICS with the "S" standing for South Africa to reflect the group's expanded membership.

BRICS SUMMIT
Summit Participants Date Host country Host leader Location

1st

BRIC

June 16, Russia 2009 April Brazil 16, 2010 April China 14, 2011 March India 29, 2012 South Africa

Dmitry Medvedev

Yekaterinburg

2nd

BRIC

Luiz Incio Braslia Lula da Silva

3rd

BRICS

Hu Jintao

Sanya

4th

BRICS

Manmohan Singh

New Delhi

5th

BRICS

2013

Jacob Zuma

TBA

BRICS REPORT 2012

The BRICS economies have been identified as some of the fastest growing countries and the engines of the global recovery process, which underscores the changed role of these economies. Even in the G-20 countriess forum, BRICS are playing a formidable role in shaping macroeconomic policy after the recent financial crisis.

At present, these five countries encompass over 40 per cent of the worlds population and account for nearly 25 per cent of total global GDP in terms of PPP. If one compares the GDP in PPP terms, four economies figure among the top ten, with China, India, Russia, Brazil, and South Africa in 2nd, 4th, 6th, 8th, and 26th places, respectively (Table 1.1).

ECONOMIC GROWTH:

It is widely perceived that over the next few decades the growth generated by the largest developing countries, particularly the BRICS, could become a much more significant force in the world economy. India and Brazil are relatively more domestic demand-driven economies. As a group, they witnessed faster economic recovery from the 2008 financial crisis than advanced and other emerging market economies (EMEs). According to an estimate by Goldman Sachs, the four original BRIC countries are expected to represent 47 per cent of global GDP by 2050, which would dramatically change the list of the worlds 10 largest economies.

Among the BRICS, China, followed by India, are the fastest growing economies in the current decade. Between 1978 and 2009, the Chinese economy grew at an average annual rate of 9.9 percent,which is much higher than the world average for the period

Brazil
In Brazil macroeconomic stabilization is a key precondition for successful reforms and sustainable growth. The challenges that the Brazilian economy faces are:

its tradeable goods sector is small when compared to other EMEs like China; saving and investment rates have to increase as in other BRICS economies like China and India; improvements are required in the public sector, the public debt structure, and financial intermediation; and it needs to enhance the depth and efficiency of the financial sector.

Russia

In the case of Russia, the key challenges are accelerating the implementation of structural reforms, particularly in inefficient and undercapitalized natural monopolies, and strengthening the investment climate.

India
For India, the major challenges are :

Making the growth process more inclusive,

Improving physical infrastructure,

Developing the agriculture sector, and

Enhancing delivery of essential public services, such as education and health, to large parts of the population.

China

Similarly for China, policy changes are needed to address both domestic and external challenges.

If China is to sustain its rapid economic growth, the economy needs to be restructured away from heavy dependence on export-led growth towards self-sustaining domestic demand, and the opportunity to share in the benefits of growth needs to be spread more equitably across all levels of society.

South Africa

The key challenge is to achieve higher levels of inclusive growth that raise employment and reduce inequality. The expansion of infrastructure networks, small enterprise promotion, the development of rural economies, industrial policy that promotes higher-value added exports, green economy initiatives, and regional integration are prioritized.

The Delhi Declaration

Delhi Action Plan which highlights the activities to be undertaken under Indias chairmanship of BRICS . Two agreements namely- Master Agreement on Extending Credit Facility in Local Currencies and BRICS Multilateral Letter of Credit Confirmation Facility Agreement- were signed by the Development Banks from BRICS countries. Released The BRICS Report focusing on synergies and complementarities between the BRICS economies and highlighting their role as growth drivers of the world economy.

BRICS REPORT 2012

The BRICS economies have been identified as some of the fastest growing countries and the engines of the global recovery process, which underscores the changed role of these economies. Even in the G-20 countriess forum, BRICS are playing a formidable role in shaping macroeconomic policy after the recent financial crisis.

At present, these five countries encompass over 40 per cent of the worlds population and account for nearly 25 per cent of total global GDP in terms of PPP.

If one compares the GDP in PPP terms, four economies figure among the top ten, with China, India, Russia, Brazil, and South Africa in 2nd, 4th, 6th, 8th, and 26th places, respectively (Table 1.1).

Observations
Since the macroeconomic parameters and features of development vary within BRICS economies, the challenges they face in making their growth processes sustainable also vary.

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