14th BRICS Trade Ministers’ Meeting

General Studies Paper -2

Context: Recently, the Commerce Secretary of India has attended the 14th BRICS Trade Ministers’ Meeting held under the BRICS Presidency of the Russian Federation.

• Theme for this year’s BRICS engagement titled as ‘Strengthening Multilateralism for Just Global Development’.

Background: About BRICS

• It is an acronym that refers to a group of five major emerging national economies: Brazil, Russia, India, China, and South Africa.
• It started after the meeting of the Leaders of Russia, India and China in St. Petersburg on the margins of the G8 Outreach Summit in 2006, as a formal grouping, and was formalised during the 1st meeting of BRIC Foreign Ministers on the margins of UNGA in New York in 2006.
  • Initially, the grouping was termed BRIC as South Africa was inducted in 2010 and from there on it has been referred to as BRICS.
  • The governments of the BRICS states have met annually at formal summits since 2009.
• Over a period of time, BRICS countries have come together to deliberate on important issues under the three pillars of political and security, economic and financial and cultural and people-to-people exchanges.
• It brings together five of the largest developing countries of the world, representing around 41% of the global population, around 24% of the global GDP and around 16% of global trade.

Importance BRICS

• Economic Cooperation: BRICS facilitates economic collaboration through initiatives such as the New Development Bank (NDB), aimed at funding infrastructure projects in member countries.
  • Economic collaboration within BRICS facilitates trade diversification, technology transfer, and infrastructure development, which are crucial for India’s economic growth and development aspirations.
• Global Governance Reform: India uses BRICS as a platform to advocate for reforms in international financial institutions like the IMF and World Bank, aiming to increase the voice and representation of emerging economies in global economic governance.
• Cultural and Academic Exchange: BRICS fosters cultural and academic exchanges, promoting people-to-people ties and enhancing mutual understanding among member countries.

Expansion of BRICS

• It was done as per the decision adopted by the 15th BRICS Summit in 2022. Argentina, Ethiopia, Egypt, Iran, Saudi Arabia, and the UAE are the six new additions to the BRICS.
  • Significance of Expansion of BRICS likely to focus on the strengthening of the group with the inclusion of countries from the Middle East and the Representative of Developing Countries and strengthening the Voice for Global Governance.

Recent Trade Ministers’ Meeting Focus Areas

• WTO Development Aspect: The Commerce Secretary emphasised the need to strengthen the multilateral trading system with the World Trade Organization (WTO) at its core, including addressing long-pending issues related to development and special and differential treatment.
• Global Value Chains (GVCs): Effective functioning of joint value chains was discussed, recognizing their critical role in international trade.
• MSMEs and Digitalisation: Interaction among Micro, Small, and Medium Enterprises (MSMEs) was highlighted, along with India’s success story in digitalization and e-commerce.
• Special Economic Zones (SEZs): Cooperation among SEZs was deemed relevant for fostering economic growth.

Multilateralism and Urgent Reforms

• Permanent Solution to Public Stock Holding: Addressing food security concerns.
• Two-Tier Dispute Settlement System: Enhancing the effectiveness of dispute resolution.
• WTO Reform: Making the organisation more responsive to the needs of emerging economies.
• ‘30 for 30’ Initiative: Proposing at least 30 operational improvements to the WTO by its 30th anniversary in 2025.
• Resilient Supply Chains: Decentralisation and diversification were advocated to enhance supply chain resilience.
• Paperless Trade: The Commerce Secretary emphasised digitalization of trade documents, such as the Bill of Lading.
• Affordable Emerging Technologies: Collaboration for green transition and climate resilience was highlighted.
• Climate-Related Measures and MSMEs: Concerns were raised about climate-related unilateral measures impacting trade.
  • Such measures were seen as conflicting with Multilateral Environmental Agreements and ignoring the principle of Common But Differentiated Responsibilities (CBDR).
  • The importance of MSMEs in global value chains was reiterated.

Conclusion

• The 14th BRICS Trade Ministers’ Meeting provided a platform for dialogue on critical trade-related issues, emphasising cooperation, inclusiveness, and the pursuit of just global development.
• As we continue to navigate the complexities of international trade, BRICS remains committed to strengthening multilateralism and fostering equitable growth.