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Bric: the writing on the wall

Bric: the writing on the wall
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First Published: Wed, Apr 21 2010. 08 42 PM IST
Updated: Wed, Apr 21 2010. 08 42 PM IST
When the post-War consensus forged new multilateral institutions in the 1940s, no one would have guessed that, 60 years later, an investment bank’s acronym would be at the heart of the next attempt to forge consensus. Last weekend, the leaders of Brazil, Russia, India and China once again seized on Goldman Sachs’ “Bric” to demand reform in the original 1940s institutions, one step towards an alternate global order.
But because a bank, not natural geography or economics, spawned Bric, the alliance hasn’t been the smoothest. At both Bric summits—in Yekaterinberg, Russia, last year and Brasilia this year—nothing concrete seems to have been achieved. There is more that divides the four nations than unites them. So India must ask why it spends so much time with them.
Look at the economics: Brazil and Russia export natural resources, India and China import them. Brazil and India don’t undervalue their currencies, and are hurt when China does so. Three of them have taken the lead in climate change with another nation (South Africa), much to Russia’s envy. Don’t forget the politics, either: India and Brazil are democracies; China and Russia are not.
Yet, it’s another kind of politics that does bring these nations together—why the acronym caught on in the first place. What makes these four important is their opposition—a negative approach—to the existing global order the West dominates. After a decade of US wars prompting stories of its decline and of a Great Recession weakening Western economies, Bric fits in neatly with the zeitgeist.
That’s important for India to keep in mind. The Obama administration has shown that India can’t always rely on the US, because the latter’s domestic pressures could suddenly upturn its foreign alliances. Bric, then, allows for more fluid policymaking. In that vein, India should keep channels other than Bric open too.
India also should urge Bric to shed its negative dependence. For instance, Bric needn’t cry foul about the dollar as reserve currency, as it did last weekend: There’s no ready alternative.
If Bric does become one part of the world organizing itself against another, it would ironically repeat the history it seeks to undo. After all, the Cold War, with its bipolar world view, played some role in ordering the 1940s institutions that Bric—with its multipolar nature—now wants to reorder.
What is Bric’s future? Tell us at views@livemint.com
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First Published: Wed, Apr 21 2010. 08 42 PM IST
More Topics: Ourviews | Goldman Sachs | Bric | Recession | Views |
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