Yves here. This post by Andrew Korybko is a follow on of sorts to the first piece of his we published at Naked Capitalism. That was on a key bit of evidence, that the so-called BRICS bank was adhering to Western sanctions, which he used to support his contention that the new BRICS currency would be much longer to come to fruition than anti-globalist enthusiasts predicted.
Here he points out something that frankly ought to be obvious given regular and often heated intramural disputes in the EU and in the more centralized US: that the BRICS, which is a fairly new body and has only recently been looking to considerably increase its scope of operation, is not necessarily unified internally on key issues. He describes here how that much-hoped-for new currency scheme is one.
By Andrew Korybko, a Moscow-based American political analyst who specializes in the global systemic transition to multipolarity in the New Cold War. He has a PhD from MGIMO, which is under the umbrella of the Russian Foreign Ministry. Originally published at his website
China envisages BRICS’ members replacing the dollar with yuan and integrating into BRI, while India wants them to prioritize the use of national currencies and doesn’t want BRICS as a whole officially connected to that global project.
A Broken Clock Is Right Twice A Day
Astute observers know that Bloomberg can’t always be trusted, but they might be telling the truth in their latest report about BRICS despite putting an obvious spin on everything. In their piece titled “China’s Push to Expand BRICS Membership Falters”, they cited two unnamed Indian officials who claimed that their country proposed strict criteria for joining BRICS after China allegedly expressed a comparatively more laidback position towards this issue.
Clarifying Common Misperceptions About BRICS
Before explaining why their report is likely true, it’s important to clarify that this leading Mainstream Media outlet obviously has an interest in framing this disagreement as yet another example of rising Sino-Indo tensions, which is why they titled their article the way they did. The wording is intended to imply that BRICS is led by China and that all other members are its junior partners. The particular content of their piece then conveys the notion that intra-group disputes are endangering its future.
The reality is that BRICS could more accurately be conceptualized as a financially focused form of RIC+. The Russia-India-China trilateral serves as its core while Brazil and South Africa function as their top partners outside of Eurasia for accelerating financial multipolarity processes. About their shared goal, this is being pursued through gradual reforms owing to each member’s relationship of complex interdependence with the Western-centric financial system, with Russia being the only exception.
The preceding observation accounts for why their reserve currency project probably won’t be launched anytime soon, if ever at all, as well as South Africa capitulating to Western pressure to have President Putin attend the next BRICS Summit online instead of in-person due to his ICC arrest warrant. It also adds context to President of the BRICS Bank Dilma Rousseff’s recent statement confirming that her institution complies with Western sanctions against Russia and thus isn’t planning any new projects there.
The Sino-Indo Dispute Over Formally Expanding BRICS
The Alt-Media Community (AMC) largely regards the aforesaid facts as setbacks since they’ve been preconditioned by top influencers to think that BRICS is a revolutionary movement dedicated to dethroning the dollar, but this is a false perception that was propagated for self-serving reasons. BRICS is still more than capable of changing the global financial system, though gradually instead of radically. To that end, its members continue de-dollarizing and building alternative non-Western financial platforms.
Nevertheless, differences still exist among them in terms of how best to go about this, hence the likely factual content of Bloomberg’s latest report regarding China’s and India’s opposite stances towards expanding BRICS. The first envisages their group’s members replacing the dollar with yuan and integrating into the Belt & Road Initiative (BRI), while the second wants to prioritize the use of national currencies and doesn’t want BRICS as a whole officially connected to that global project.
Accordingly, China reportedly has a comparatively more laidback position towards expanding BRICS since it mostly only expects new members to accelerate the yuan’s internationalization and their integration into BRI whereas India’s position is stricter due to the complexity of prioritizing national currencies. There’ll of course be those in the AMC who’ll claim that Bloomberg’s latest report supposedly proves that India is the West’s Trojan Horse in BRICS, but they couldn’t be more wrong.
Clarifying Common Misperceptions About India
In early May, it was advised that “RIC’s Differences Should Be Candidly Acknowledged Instead Of Denied Or Spun By Alt-Media”. One month later, the US’ hosting of Prime Minister Modi in spite of his brave defiance of its demands to dump Russia showed that “The US Finally Realized The Futility Of Trying To Force India Into Vassalhood”. This development proved that India has completed its rise as a globally significant Great Power whose strategic autonomy in the New Cold War is respected by all key players.
Those top AMC influencers who still insist that India is the West’s Trojan Horse in multipolar fora contradict the conclusions of top Russian officials who reassuredeveryone after Prime Minister Modi’s trip to the US that bilateral ties still remain strong. It’s their right to believe whatever they want, but observers should be aware that there isn’t any substance to their claims, which have been debunked by diplomatic professionals who obviously know better about Indian policy than those folks do.
This insight is integral for readers to keep in mind so as to avoid being misled by agenda-driven AMC influencers who propagate literal conspiracy theories about India’s global role for whatever their reasons may be. Returning to Bloomberg’s article, this supplementary clarification should improve their understanding of BRICS’ dynamics in general and Sino-Indo differences towards the issue of the group’s formal expansion in particular.
The Pros & Cons Of China’s & India’s Approaches
Both Asian Great Powers are sincere in their desire to gradually reform the Western-centric financial system, but they disagree over how best to go about it. China wants to accelerate the yuan’s internationalization and BRICS’ integration into BRI whereas India wants to prioritize the use of national currencies and keep BRICS separate from BRI. These opposite approaches reflect their respective national interests and are therefore natural to espouse unlike what the AMC might claim about India’s.
Each pathway has its merits but also compelling arguments against it too. Regarding China’s, it would speed up financial multipolarity processes but at the risk of making some countries suspect that the People’s Republic secretly wants to replace the US’ unipolar role, even if only in Asia. As for India’s, it would strengthen each country’s financial sovereignty but the timeline for effecting major change would likely be longer than China’s pathway, plus it’s comparably more complex to implement.
Considering that “The SCO States Agreed On The Contours Of The Emerging World Order” during early July’s virtual leaders’ summit in spite of rising Sino-Indo tensions, recent precedent suggests that the BRICS ones will likely reach a compromise on their group’s expansion that meets everyone’s interests. This could most realistically result in implementing the BRICS+ concept popularized by Russian geo-economic guru Yaroslav Lissovolik so that prospective members can formalize their ties with the bloc.
BRICS+ Could Be A Mutually Beneficial Compromise
While it can’t be discounted that China and India might agree on one or two countries joining as official members, which Bloomberg’s report claims that the other three wouldn’t be opposed to in principle, this compromise could prevent rising Sino-Indo tensions from impeding the group’s growth. Delhi’s interests would be served by establishing criteria for official membership, whatever the details thereof might ultimately be, while Beijing’s would be served by still having them participate in BRICS activities.
Those countries that are interested can internationalize the yuan and integrate into BRI through the ambit of their bilateral ties with China and participation in non-BRICS platforms while prioritizing the use of national currencies via their ties with fellow BRICS and BRICS+ members exactly as India envisages. If the parts from Bloomberg’s report about Brazil’s, Russia’s, and South Africa’s positions on this issue are to be believed, then those three are tacitly more aligned with India’s approach than China’s.
China’s Stance On This Issue Is The Real Outlier
Their Brazilian and South Africans sources were unnamed, but their Russian one was Valdai Club research director and head of the Council on Foreign & Defense Policy Fyodor Lukyanov, whose two affiliated institutions advise the Kremlin. He’s one of Russia’s most influential experts and was quoted as saying that “It’s broadly in favor of BRICS expansion, but without any huge enthusiasm. It’s following the others’ lead. We won’t block any decision.”
There are no credible reasons to believe that Bloomberg invented his quote like AMC conspiracy theorists might imagine, nor that this highly respected expert misinformed his audience about Russia’s position on this sensitive issue. Rather, Lukyanov candidly described the Kremlin’s thoughts in order to dispel false perceptions and associated expectations like those that have hitherto been cultivated by top AMC influencers. This confirms that Russia recognizes BRICS’ previously described intra-group dynamics.
The Kremlin’s measured and pragmatic stance is a reflection of its national interests, the same as can be said about China’s and India’s enthusiastic and cautious ones respectively. Likewise, Brazil and South Africa presumably have similar approaches to this issue as Russia does for the same reason, though their corresponding national interests have more to do with not coming under any more Western pressure. This overall assessment raises the chances that they’ll agree on implementing BRICS+ as a compromise.
India’s reported request that there be strict criteria for joining BRICS therefore isn’t a bad thing like the AMC might be inclined to think since it arguably aligns with every other members’ views apart from China’s, which thus makes it representative of the majority and not a supposedly US-influenced outlier. There’s nothing bad about China’s stance either since it’s also well-intentioned, but it’s Beijing that’s the outlier on this sensitive issue, not Delhi or anyone else. In any case, a compromise will likely be reached.