Daily Editorial Analysis 12 September 2026

The BRICS Bank — An Alternative That Wasn’t 

Context

• The 18th BRICS Summit, hosted by India in New Delhi on September 12–13, 2026, under the banner Humanity First, offers an opportunity to examine the bloc’s ambition to reshape global finance.
• BRICS seeks to challenge western dominance, reduce dependence on the U.S. dollar and create institutions that better represent developing countries.
• However, seventeen years of cooperation reveal a gap between its political rhetoric and institutional performance.
• The New Development Bank (NDB), Contingent Reserve Arrangement (CRA) and de-dollarisation agenda have not produced a genuinely independent financial architecture.

BRICS and the Quest for Financial Independence

• BRICS emerged from dissatisfaction with the unequal distribution of power in the World Bank and IMF.
• Developing countries have criticised their Western-oriented governance and financial conditions.
• The bloc responded by establishing alternative institutions and promoting local currencies to strengthen the bargaining power of emerging economies.
• Yet, genuine independence requires institutions capable of operating outside the financial structures they challenge.

The New Development Bank: An Incomplete Alternative

• Dependence on the Existing Financial System
• The bank’s record demonstrates significant limitations. Approximately 50% of its outstanding bonds are denominated in U.S. dollars, while the Chinese yuan accounts for most of the remainder.
• The South African rand represents only 1%. Local-currency lending stood at roughly 22% by mid-2025, below the 30% target for 2026.
• The delayed development of a rupee-denominated bond further illustrates the difficulty of achieving financial independence.
• The NDB also relies on Western credit-rating agencies, including S&P, Fitch and Moody’s.
• In March 2022, it suspended operations related to Russia to protect its credit standing, revealing the influence of external financial discipline.
• Scale and Institutional Limitations
• The NDB approved projects worth approximately $39 billion by the end of 2024, compared with around $100 billion committed annually by the World Bank Group.
• Its co-financing with established institutions suggests that it functions as a complementary institution rather than a direct competitor.

The Contingent Reserve Arrangement: A Safety Net Without Independence

• The CRA has never been activated. Members seeking more than 30% of their allotted share must first enter into an IMF programme.
• This condition undermines its purpose of reducing dependence on the IMF.
• The absence of permanent staff, independent surveillance and a research wing further limits its effectiveness.
• The CRA therefore represents a significant political aspiration but an underdeveloped crisis-management mechanism.

De-dollarisation: Rhetoric Versus Reality

• Divergent National Interests

  • India opposes a common BRICS currency because of potential U.S. trade reprisals.
  • South Africa considers it risky, while China favours gradual yuan internationalisation. Russia has stated that BRICS has not sought to abandon the dollar.
  • The absence of de-dollarisation from the 126-point Rio declaration of 2025 reflects the bloc’s cautious official position.
  • Divergent national interests prevent BRICS from adopting a unified monetary strategy.

• The Dollar’s Continuing Influence

  • BRICS countries remain dependent on dollar-based financing and global capital markets.
  • The reported threat of additional U.S. tariffs against countries pursuing anti-American BRICS policies further demonstrated Washington’s economic influence.
  • The bloc’s lack of a collective response exposed the limits of its willingness to challenge the existing monetary order.

Reforming the IMF or Replacing It?

• BRICS declarations at the Kazan summit in 2024 and Rio summit in 2025 called for a quota-based and adequately resourced IMF.
• This seeks greater representation within the existing system rather than its replacement.
• The United States holds 16.49% of IMF voting rights, while major decisions require an 85% supermajority, giving Washington an effective veto.
• BRICS countries seek greater influence but have not demonstrated a willingness to bypass these arrangements.
• Their objective may therefore be a stronger position within the existing financial order.

India’s Leadership and the Future of BRICS

• India’s 2026 summit provides an opportunity to reassess BRICS priorities.
• Its expansion to Egypt, Ethiopia, Iran and the UAE indicates genuine interest in a more representative global order.
• However, expansion alone cannot guarantee effectiveness.
• BRICS must strengthen local-currency financing, improve the CRA’s independence and develop practical mechanisms for reducing financial vulnerabilities.
• India can promote a realistic agenda focused on financial inclusion, infrastructure and global governance reform.

Conclusion

• BRICS has successfully brought together emerging economies and challenged the legitimacy of Western dominance.
• Yet, BRICS has not created an independent global financial architecture. The NDB remains tied to dollar financing and Western credit-rating agencies, while the CRA depends on IMF-linked conditions.
• The central challenge is whether BRICS members are willing to accept the costs of genuine institutional independence.
• Until then, BRICS will remain more a platform for negotiating a better position within the existing global order than for replacing it.

The BRICS Bank — An Alternative That Wasn’t FAQs

Q1. What is the main objective of BRICS?
Ans. BRICS aims to promote a more representative global financial order and reduce Western dominance.

Q2. Why has the NDB not become a complete alternative to the World Bank?
Ans. The NDB remains dependent on dollar financing, Western credit-rating agencies and cooperation with existing institutions.

Q3. Why has the Contingent Reserve Arrangement remained unused?
Ans. The CRA has never been activated because significant withdrawals require an IMF programme.

Q4. Why has BRICS made limited progress on de-dollarisation?
Ans. Divergent national interests among BRICS members have prevented a unified de-dollarisation strategy.

Q5. What is the key challenge before BRICS?
Ans. The key challenge is to develop genuinely independent institutions rather than merely seek greater influence within the existing financial order.

Source: The Hindu

A Bigger BRICS, Shaped by India’s Vision 

Context

• The 18th BRICS Summit, hosted by India in New Delhi on September 12–13, 2026, comes at a time of geopolitical turbulence, wars, weakening global governance and shifting alliances.
• With 11 prominent members and around 10 partner countries, BRICS has emerged as a major transcontinental grouping whose collective economic output in purchasing power parity exceeds that of the G7.
• At the same time, artificial intelligence and quantum computing are becoming instruments of strategic competition.
• India therefore seeks to use its chairmanship to strengthen BRICS through resilience, innovation, cooperation and sustainability.

India’s BRICS Moment

• India’s extensive preparations reflect the organisational experience gained from hosting the G20 Summit in 2023.
• Around 350 meetings, including 22 at the ministerial level, have been organised across different Indian cities.
• BRICS traditionally rests on three pillars: political and security cooperation, finance and economic cooperation, and cultural and people-to-people exchanges.
• India’s current emphasis is particularly focused on the latter two pillars, where practical cooperation can deliver tangible developmental benefits despite political differences among members.
• The diversity of BRICS makes such an approach valuable.
• Its members differ in their political systems, economic structures and technological capabilities, but share several developmental challenges.

India’s Vision

• Building Resilience and Driving Innovation

  • Strengthening Resilience

    • India has promoted initiatives aimed at strengthening collective resilience.
    • The BRICS Digital Centre of Excellence for Smart Grids and Energy Storage can support modern energy systems, while the Logistics Supply Chain Cooperation Framework can reduce vulnerabilities arising from disruptions in global trade.
    • The Centres of Excellence on Agro-Ecology and Regenerative Agriculture can contribute to food security, sustainable agriculture and climate resilience.
    • Together, these initiatives can facilitate knowledge sharing, capacity building and adoption of best practices.

• Promoting Innovation

  • India has also encouraged technological and scientific collaboration through proposals for a start-up innovation fund, incubator network, digital public infrastructure repository and science and research repository.
  • Greater cooperation in research infrastructure and mega science projects can help bridge technological disparities among BRICS members.
  • Such collaboration is increasingly important as countries compete for technological and scientific leadershipin AI, quantum computing and other emerging technologies.
  • Deepening Cooperation for Inclusive Development
  • BRICS cooperation must ultimately translate into improvements in citizens’ lives.
  • Proposals to revitalise the multilateral trading system, establish centres of excellence on mental wellness and create a BRICS urbanisation forum can address major economic and social challenges.
  • Initiatives for women’s digital empowerment, education, youth skilling and MSME cooperation can expand employment, entrepreneurship and economic participation.
  • Such measures can ensure that BRICS benefits extend beyond governments and large corporations to ordinary citizens.

• Sustainability and Climate Resilience

  • Sustainability occupies an important place in India’s agenda.
  • Cooperation is proposed in areas such as combating desertification, disaster management, forest-fire preparedness and sustainable aviation fuels.
  • Particularly significant is the emphasis on people-centric and community-based climate adaptation.
  • While global climate diplomacy often focuses on mitigation, developing countries also require stronger adaptation mechanisms to protect vulnerable communities and livelihoods.
  • This approach connects climate policy with human welfare and recognises that environmental resilience must be built at the community level.

BRICS and the Multipolar World Order

• BRICS increasingly represents the aspirations of countries seeking greater strategic autonomy and a more representative global order.
• For India, the grouping complements its foreign-policy objectives of strategic flexibility and multipolarity.
• However, BRICS must carefully manage its internal differences.
• Its members have divergent geopolitical interests, and excessive focus on strategic rivalry could undermine practical cooperation.
• The grouping should therefore avoid becoming dominated by geopolitical disputes that do not advance collective interests.
• Its long-term credibility will depend on concrete outcomes rather than political declarations.

Conclusion

• The 2026 BRICS Summit provides India with an opportunity to strengthen the grouping as a platform for inclusive development, technological cooperation, climate resilience and sustainable growth.
• Its growing economic and political significance gives it considerable potential to influence the international order.
• India’s emphasis on resilience, innovation, cooperation and sustainability can give BRICS a more people-centric character.
• If members successfully convert ambitious proposals into practical outcomes, BRICS can strengthen strategic autonomy, promote development and contribute to a genuinely multipolar world order.

A Bigger BRICS, Shaped by India’s Vision FAQs

Q1. What makes the 2026 BRICS Summit significant?
Ans. The summit is significant because BRICS has expanded its membership and economic influence amid major geopolitical changes.

Q2. What are India’s four priorities for BRICS?
Ans. India’s priorities are resilience, innovation, cooperation and sustainability.

Q3. How can BRICS promote innovation?
Ans. BRICS can promote innovation through joint research, start-up support, incubator networks and digital infrastructure cooperation.

Q4. Why is climate adaptation important for BRICS?
Ans. Climate adaptation is important because it can protect vulnerable communities and livelihoods from increasing climate risks.

Q5. What is India’s broader objective through BRICS?
Ans. India seeks to strengthen strategic autonomy and a multipolar world order through BRICS cooperation.

Source: The Hindu

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