Importance of both Quad and BRICS

Context: The foreign ministers’ meeting of QUAD nations to be held comes at a time when the United Nations Security Council (UNSC) is weakened and its reform nowhere in sight. 

Current geostrategic realities and dilemmas

• Both the Ukraine war and Israel's actions in Gaza demonstrate blatant disregard for international law.
• An axis of Russia, China, North Korea, and Iran is gaining momentum and Chinese influence is growing not just in the Indo-Pacific, but regions like West Asia too. 
• The U.S. has realised that it needs not just allies, but also credible partners in its security architecture, including in the Indo-Pacific, and reached countries like India to partner with them in smaller pluri-lateral groupings and joint security initiatives.
• Further, ASEAN countries are getting increasingly vulnerable, with the South China Sea remaining a conflict point. 
• While India is a member of many pluri-lateral groups on both sides of the geo-strategic ‘divide’, its engagement in Quad and with BRICS present the country with interesting, and sometimes contrasting, dilemmas.
  • India has enthusiastically embraced Quad and its strategic objectives.
  • The fact that India, during its presidency of the UNSC in 2021, held a high-level virtual event on ‘Enhancing Maritime Security’, which was attended by the Russian President, among others, indicates the importance India attaches to strengthening maritime security in the Indo-Pacific and beyond.
  • India was an enthusiastic founder of BRICS. In fact, at the 10th annual summit of the BRICS in 2018, India reminded the BRICS members of its ‘reformed multilateralism’ vision. 

In the backdrop of this, let us understand the significance of QUAD and BRICS and their importance for India. 

What is QUAD?

• The occurrence of a Tsunami in the Indian Ocean led to India, Japan, Australia, and the US to build an informal alliance for collaborating on disaster relief efforts. 
• In 2007, Japan formalised it into the Quadrilateral Security Dialogue or the QUAD. 
• The Quadrilateral Security Dialogue (QSD), the Quad is an informal strategic forum comprising, United States of America (USA), India, Australia and Japan.
• One of the primary objectives of the Quad is to work for a free, open, prosperous and inclusive Indo-Pacific region.
• The group met for the first time in 2007 on the sidelines of the Association of Southeast Asian Nations (ASEAN).
• The Quad regained momentum in 2017, driven by shared concerns regarding the assertiveness of China in the Indo-Pacific region and a desire to uphold peace and stability in the Indo-Pacific.
• It was in 2017 when the first official talks under the Quad took place in the Philippines.
• Quad Summit in 2022 (Tokyo): 
  • The Quad summit witnessed the launch of a new initiative for continuous collaboration in the maritime domain, space, climate change, health, and cyber security.
  • The member countries pledged to meet challenges for ensuring rules-based maritime order, including in the East and South China Seas. 
  • The members strongly opposed any coercive, provocative, or unilateral actions that seek to change the status quo.

Significance of Quad:

• Delivering outcomes for the Indo-Pacific: In response to the region's priorities and most pressing challenges, including health security, climate change, infrastructure, critical and emerging technology, cyber security, disaster relief, maritime security, countering-terrorism, etc. 
  • In the face of the global COVID-19 pandemic, the Quad gained further relevance as the group shifted its focus to vaccine diplomacy, health security, and economic recovery.
• ASEAN centrality: Quad partners work closely to ensure efforts complement wider engagement in the Indo-Pacific, both bilaterally and through regional institutions.
  • All Quad partners are long-standing ASEAN Dialogue Partners and steadfast supporters of ASEAN centrality, the ASEAN-led regional architecture and the ASEAN Outlook on the Indo-Pacific.
• Strengthened bilateral relationships among Quad nations:
  • India now has ministerial-level ‘2+2’ (defence and foreign minister) meetings with Japan and the United States and Australia. 
  • India and the United States further signed a communications compatibility and security agreement (COMCASA) in 2015 and a logistics exchange memorandum of agreement (LEMOA) in 2016.
  • A major obstacle to closer Japan-India relations was removed with the passage of the landmark Japan-India civil nuclear cooperation agreement in May 2017.
  • Japan became a permanent member of the formerly bilateral U.S.-India naval exercise, Malabar, in 2015.
  • The AUSINDEX exercise between Australia and India grew in size and scope.
  • The function of these bilateral and mini-lateral exercises was to create trust among the militaries of the Quad nations, promote interoperability, and set the foundation for political ties at a deeper level.
• Grappling with geopolitics: 
  • Japan’s foreign policy has become more explicitly anti-Chinese, with emphasis on the physical security of its territorial space and linking defence of Northeast Asia to the rest of the Indo-Pacific. 
  • Australia views China as a strategic rival and seeks security through partnerships,  both formal and informal, with other powers, rather than having to balance relationships with China. 
  • As for the U.S., it benefits from the Quad principally because, until the emergence of the framework, Washington lacked any overarching instrument to manage its many security relationships in the Indo-Pacific.
    • The U.S. is now party to a structure that oversees all the key lines of communication from Northeast Asia through the Indian Ocean, and stands to gain from intelligence sharing.
• Significance for India: 
  • It is believed that the forum strategically counters China’s economic and military rise. Interestingly, if Chinese hostilities rise on the borders, India can take the support of the other Quad nations to counter the communist nation.
  • India can even take the help of its naval front and conduct strategic explorations in the Indo-Pacific region.
  • From a security perspective, New Delhi’s relationship with Washington delivers effective balance against China at both the strategic (nuclear deterrence) and conventional levels. 
  • On the diplomatic field, a U.S. partnership adds weight to India’s geopolitical heft. As India strives to grow its economy, it needs the U.S. military presence to ease its defence spending burden.
  • Being a strategic partner of the U.S. helps India attain better access to the lucrative U.S. market and thereby build its citizens’ affluence.
  • India’s vision goes beyond viewing Quad as a geopolitical security objective vis-à-vis China.
    • India aims to redraw the security and techno-economic architecture of the Indo-Pacific region.
    • With Quad now working on reorientation of global supply chains of critical technologies and on a range of areas of direct strategic relevance to the region, including digital, telecom, health, power, and semiconductors, it has underlined that development too has a security perspective which cannot be ignored.

What is BRICS? 

The BRICS countries are considered the foremost geopolitical rival to the G7 bloc of leading advanced economies, implementing competing initiatives such as the New Development Bank, the BRICS Contingent Reserve Arrangement, the BRICS pay, the BRICS Joint Statistical Publication and the BRICS basket reserve currency.

• Initially termed BRIC in 2001, the acronym BRICS was coined by Jim O’Neill, a Goldman Sachs economist, to encompass Brazil, China, India, and Russia.
• The BRIC grouping’s first formal summit was held in Yekaterinburg, Russia, commenced in 2009. During this summit, BRIC Leaders issued a Joint Statement elucidating the objectives of the BRIC collaboration. 
• South Africa officially became a member nation in 2010. The group was renamed BRICS – with the “S” standing for South Africa – to reflect the group’s expanded membership. 
• In 2023, Egypt, Ethiopia, Iran, Saudi Arabia and UAE joined BRICS. 
• These BRICS nations possess a notable competitive advantage owing to their economical labor costs, advantageous demographics, and copious natural resources, particularly during the era of the global commodities upswing.

Significance of BRICS: 

BRICS has evolved into a unified and purposive entity, championing the cause of reforms in major multilateral institutions with a clear intention of democratising global governance.

• Establishment of the New Development Bank (NDB) in 2013: 
  • Endowed with an initial capital of US$50 billion, the NDB was conceived as a credible alternative to existing financial institutions (like IMF and World Bank which are dominated by the western powers). 
  • The equitable distribution of the initial subscribed capital among BRICS members underscores the commitment to collective action.
• Trade and investment landscape within BRICS: 
  • Promising dynamics between India and China within the broader BRICS umbrella. 
  • The bilateral trade between India and China reached a historic high of US$ 135.98 billion in 2022.
  • The contribution of BRICS members to global exports has been on the rise, with the growth rate of exports between BRICS member states surpassing the global average. 
  • This has yielded concrete advantages and played a pivotal role in fostering increased investment within the bloc.
  • The intra-BRICS integration encompasses free trade agreements and export-oriented strategies, including tariff exemptions, tariff reductions, across various goods and service sectors. This proactive approach has led to substantial growth, expanding trade, and a rise in both inward and outward foreign direct investment (FDI). 
  • According to UNCTAD data, cumulative foreign direct investment (FDI) holdings within the BRICS nations substantially increased from US$ 27 billion in 2010 to US$ 167 billion in 2020.
  • This shift collectively represented 1.3 percent to 4.7 percent of their total FDI assets, marking considerable growth.
  • Notably, China played a predominant role, being the most significant contributor and recipient of FDI among BRICS nations.
  • Moreover, Brazil and India also observed robust investment expansions from fellow BRICS members. 
• BRICS Contact Group on Economic and Trade Issues (CGETI): 
  • Acknowledging the significance of enhancing BRICS nations' attractiveness as investment destinations, even amid the challenges posed during the COVID-19 pandemic, CGETI has urged additional measures to create a conducive atmosphere for sustainable development-oriented investments.
  • This includes initiatives to improve transparency and simplify national administrative processes and prerequisites.

Significance of the inclusion of new members:

• Enhanced inclusivity:
  • Including more countries from Africa and Asia will enhance BRICS' representation of developing nations and diversify its geographical reach.
  • A more diverse BRICS gains legitimacy advocating for Global South issues like fair-trade, climate justice, and technology access.
  • Formerly representing 40% of the world’s population and a quarter of GDP, expanded BRICS now covers nearly half the global population.

• Economic strength:
  • BRICS, earlier represented 24% of global GDP and now with the inclusion of five new economies, it could increase its influence in IMF and World Bank forums. 
  • In 2022, intra-BRICS trade reached $500 billion and the expansion could enhance trade and investment, strengthening economic ties and bargaining power.
  • Saudi Arabia, Iran, and the UAE, among the world's top-10 oil producing countries, enhance BRICS' global influence in shaping energy policies and market dynamics, strengthening its role as a Global South champion.

• Advocacy for reforms:
  • BRICS have collectively called for reforms to the UN Security Council to include more representation from the Global South.
  • An expanded BRICS can bolster the Global South's political voice in international forums, advocating for reforms aligned with their interests.
  • BRICS nations agreed to promote use of local currencies in trade to reduce dependence on major global currencies.
  • The expanded BRICS could provide grounds for this practice. The UAE and India have agreed to trade in Rupees and Dirhams instead of the US Dollar.

With India being the only country common to both Quad and BRICS, the country has immense opportunities at its doorsteps which can be explored with the right strategic policies to serve its larger goals.