BRICS Summit: Emerging World Powers Aim to Boost Trade, Set Up Development Bank

Leaders of the top five emerging world powerhouses, Brazil, Russia, India, China and South Africa (BRICS), will kick off a two-day summit in the Indian capital today, eyeing increased trade cooperation and seeking common ground on the plan to set up a development bank.

The bloc, which got its name from the coinage made by a Goldman Sachs analyst, first met at Yekaterinburg, Russia, in 2009. In 2010, the original BRIC grouping added South Africa to its fold and became BRICS.

This year's summit is held around the theme BRICS Partnership for Global Stability, Security and Prosperity. The members of the bloc are expected to discuss ways to enhance mutual cooperation in the backdrop of the Eurozone crisis and the global economic uncertainty.

While the new risks to global economy emanating from euro zone debt crisis and uncertainty in global energy markets will have their impact upon economic growth in the BRICS countries, I am confident BRICS countries will continue to register strong growth, India's Union Minister of Commerce Industry and Textiles, Anand Sharma, said in a statement.

The minister said boosting the intra-BRICS trade will be a major goal of the summit and that the proposal to extend credit facility in local currencies by BRICS Development Banks will possibly get instituted into an agreement.

The proposal to provide credit facilities to member countries in the local currency was made at the third BRICS conference at Sanya, China.

BRICS Development Banks are in the advance stages of concluding Agreements on Extending Credit Facility in Local Currencies, and Multilateral Letter of Credit Confirmation Facility Agreement to facilitate further consolidation of trade and investment ties. Such intra-BRICS initiatives will not only contribute to enhanced intra-BRICS trade and investments but would also facilitate our economic growth in difficult economic times, minister said.

A meeting of the BRICS trade ministers was held on Wednesday in New Delhi, on the sidelines of the summit. The ministers said trade within the bloc is expected to touch $500 billion by 2015 from around $200 billion currently.

Some Facts About BRICS:

BRICS consists of the five emerging economies from Asia, Africa and Latin America.

• BRICS includes the two most populous countries, China and India, and together represents 42 percent of the world's population.
• BRICS countries account for 40 percent of global GDP ($18.486 trillion) and its share is increasing every year.
• It has an estimated US$4 trillion in combined foreign reserves.
• Intra-BRICS trade is growing at an average of 28 percent annually. Currently the trade is worth around $230 billion.
• The share of BRICS economies in global trade has been increasing over the years. In 2010 it stood at 15 per cent, up from 13.7 per cent the year before.
• BRICS countries account for more than half of the private equity investment and FDI inflow among the emerging economies.