While the expansion of BRICS is important in economic and geopolitical terms, it is important to understand the complexities and nuances of the global geopolitical and economic landscape.
Author
Tridivesh Singh Maini, Assistant Professor, Jindal School of International Affairs, O.P. Jindal Global University, Sonipat, Haryana, India.
Summary
Iran, Saudi Arabia, UAE, Egypt, Ethiopia formally entered the BRICS+ grouping on January 1, 2024. The five countries had been invited to join BRICS in the 15th BRICS Summit held at Johannesburg in August 2023. Argentina had also been invited to join the organisation but the country’s new President Javier Milei reversed his predecessor’s decision.
Significance of new countries joining BRICS
The entry of these five countries in the BRICS grouping, which was formed by Brazil, Russia, India and China in 2006 with South Africa joining in 2010, is important for several reasons. Firstly, the combined economy of the new grouping is $28.5 trillion, which is well over 1/4th of the global economy (28%). The combined population of BRICS+ is 3.5 billion people, which is around 45% of the world population. BRICS+ will also be producing well over 40% of the global oil.
Secondly, Russia has assumed chairmanship of BRICS in 2024 and tensions with the west have only increased in the aftermath of the Russia-Ukraine conflict. As a result of growing geopolitical tensions with the west as well as the imposition of sanctions on Russia, several countries such as India, UAE, Saudi Arabia which have robust ties with the US have been pushing for de-dollarization — or lesser dependence upon the US dollar for trade. Only recently for instance, Iran and Russia had finalised an agreement for trade in local currencies. It would be pertinent to point out that there has been a significant rise in non-dollar trade in commodities after the imposition of sanctions on Russia. Putin, in a virtual address to the Johannesburg Summit, dubbed de-dollarization as “irreversible” and “gaining pace”.
Published in: DNA
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