Almost 50 per cent of the global GDP based on purchasing power parity, more than half the world’s population and some of the fastest-growing economies compared to the collective West are factors that any economist would love to bank on.

But it has become a cause of anxiety in the West, the Global North, and has already miffed US President Donald Trump, although he dismissed the bloc as a short-lived phenomenon.

The BRICS, a collective of emerging economies that held its annual conclave in Rio de Janeiro, Brazil, on 6 and 7 July, now clearly shows its stripes 16 years after it was launched.

The acronym BRIC was coined by Jim O’Neill, chief economist of Goldman Sachs, in 2001, who forecasted that the group would dominate the global economy by 2050.

After early meetings by the foreign ministers of Russia, India and China (RIC), the group took shape as BRIC in 2009 with Brazil joining it. It became BRICS after South Africa joined a year later.

The emerging economies joined hands and formed the bloc that is today shaping up as a formidable union of the Global South and an imminent challenge to the long-held dominance of the Global North, much of it struggling economies.

BRICS added Egypt, Iran, the UAE, Ethiopia and Indonesia in 2024. Belarus, Bolivia, Cuba, Kazakhstan, Malaysia, Nigeria, Thailand, Uganda, Uzbekistan and Vietnam are the new members that took part in the Rio summit.

Although Saudi Arabia had already joined BRICS last year, the oil-rich kingdom has yet to become a full member. But Riyadh is expected to be part of the BRICS sooner than later, adding might, muscle and money to the grouping.

The entry of Vietnam came at a time when the US was trying to recruit it in the US-led formation against China. On the contrary, Vietnam and China held bilateral talks during the BRICS, highlighting new possibilities of being part of the bloc.

Cuba has been suffering from over 60 years of a US-imposed blockade and hopes to benefit from its entry into the union of some of the fastest-growing economies, such as China and India, besides oil-rich Gulf and Iran.

Although not a BRICS member, Mexico sent its Secretary of Foreign Affairs, Juan Ramón de la Fuente, for the Rio summit. It was a clear sign that it would seek allies and wouldn’t take Trump’s bullying lying down.

Some of the key pursuits of the BRICS are the emergence of the Global South as a credible and powerful economic and geopolitical alternative, de-dollarisation to ease the grip of the expensive US dollar, and a much closer understanding between the partners in science and technology to benefit their peoples.

This essentially means reduced dependence on the US-led Global North.

De-dollarisation

Brazilian President Luiz Inácio Lula da Silva called for a new way to do business. “The world needs to find a way that our trade relations do not have to pass through the (US) dollar,“ Lula told journalists during the summit.

He has for long been urging member states to adopt measures to de-dollarise international trade since the US dollar is used to do business even between BRICS members. He had first called for de-dollarisation in 2023 while addressing the New Development Bank, the BRICS bank, in Shanghai.

Much of the BRICS have seemingly come to an understanding to work their way towards a common payment instrument, although not a common currency like the euro.

Trump immediately slammed the move and warned of an additional 10 per cent tariffs on BRICS states if they dropped the dollar.

But as Lula admitted, it would take serious efforts between the member states to find a way of trading without the US dollar, which is the most popular currency for all international trade.

The entry of the UAE and Saudi Arabia, which are already halfway there, has added petro-dollar might to the group that, along with industrial power China and tech power India and Brazil, is now capable of flexing some muscles before the Global North.

Many eyebrows were raised due to the absence of Chinese President Xi Jinping and Russian President Vladimir Putin at the Rio summit. Putin had to skip the event, as he is wanted by the International Criminal Court for his role in the 2022 invasion of Ukraine, and Brazil would have had to act as a signatory of the Rome Statute, the treaty that established the court.

While Russia was represented by its foreign minister Sergey Lavrov, China sent its premier Li Qiang, ending speculations in the Western media about the group’s cohesion.

India and China seek better ties.

Just days after the BRICS summit, foreign ministers of India and China met in Beijing and took note of the “progress made by the two sides to stabilise and rebuild ties, with priority on people-centric engagements…”

India’s relationship with China had strained recently after Beijing allegedly backed Pakistan in the four-day armed skirmish following a terror attack on India’s Kashmir for which Delhi blamed Islamabad, a charge the latter denied.

But Indian foreign minister S. Jaishankar’s visit to Beijing and the talks to maintain “peace and tranquillity in the border for the smooth development in bilateral relations and supported continued efforts towards de-escalation and border management” were lauded as a good sign to focus on bilateral ties between two of the biggest BRICS partners.

Indian Prime Minister Narendra Modi may visit China for the Shanghai Cooperation Organisation (SCO), in what would be his first visit after 2019. The SCO is a permanent intergovernmental organisation focused on cultural, security, and economic cooperation between member states.

India on July 22 resumed tourist visas for Chinese nationals after a gap of five years. The tourist visa was suspended in 2020 in view of Covid-19 but got caught in the border tensions between the two neighbours.

The new developments indicate a restoration of ties that took a beating following the 2020 clash between Indian and Chinese armies in the Galwan Valley.

The strengthening of the BRICS is in no way going to be confrontationist since most of its members are already close economic or strategic partners of the US and the European Union. While China is the much-envied ‘factory of the world’ that the world cannot live without until a new one emerges, India has, over the past couple of decades, drifted closer to the US while maintaining close ties with the EU.

The Gulf states are strategic defence partners of the US, as the UAE and soon-tobe- BRICS member Saudi Arabia host American military bases. Both the Gulf neighbours have been strong partners in the global war against terror.

Even as the Global North closely observed the developments, BRICS proposed a new subsea fibre optic network between partner states to provide cheaper and more reliable digital infrastructure.

BRICS digital network

President Lula is backing a feasibility study for the subsea cable network aimed at reducing dependency on the existing network concentrated in the Global North.

The proposed network spanning 35,000 kilometres seeks to establish independent digital communication pathways bypassing the more expensive US-centric routing systems. This could boost data transmission speeds, security and eventually the national digital economies of partner states.

Brazil already plays a key role in global digital infrastructure due to its strategic location. It supports critical cable networks linking South America to North America, Europe and Africa.

The West would be watching every little move in the BRICS bloc, although all sides would welcome economic growth for peace and tranquillity.