Few blocs have grabbed so much global attention in such a short span as BRICS has. Its appeal is not as much in the fact that its five members Brazil, Russia, India, China and South Africa are drawn from four continents, but in its ability to stay united and apolitical although the members are as different as chalk and cheese.

But the BRICS are showing signs of stumbling upon their first major challenge, the danger of politics seeping into a body that is largely driven by developmental agendas. 

Ironically, the threat of BRICS experiencing the first jolt of politics surfaced in the fifth BRICS Summit in Durban, South Africa, when the grouping embarked upon their most ambitious project yet, setting up a development bank.

Take a glance at this quote from South African Finance Minister Pravin Gordhan, "It's done. We made very good progress; the leaders will announce the details." 

And then contrast it with Russian Finance Minister Anton Siluano, "There was a proposal to declare capital of $50 billion but to pay $10 billion. It's going to be $2 billion for each member if divided by five. It's big money. It's going to be hard for us to debate this issue in parliament. I think that all the other states will also have this problem. The sides also failed to reach a consensus on the principles of governance." 

What went wrong? Why such major discrepancies, along with the accompanying diplomatic damage, in the statements?

A senior Indian official, conversant with the issues but not authorized to speak to the media, unraveled the mystery on condition of anonymity.

He said that when Brazil and South Africa expressed their inability to pay their share of $10 billion for setting up the bank with a $50 billion corpus, China offered to pay a part of their obligations. China even proposed to raise the corpus of the proposed bank to $100 billion and meet the obligations of Brazil and South Africa even then.

This alarmed India, the official explained, as it would make China more-equal-than-others in the grouping. India's argument has been that all financial liabilities of the grouping should be rooted in the principle of equality irrespective of the size of the economies of the five member states.

India's concern, spoken or unspoken, is that it does not want to be seen as a weaker or inferior power to China. But it is here that the spirit of BRICS eventually worked and neither China nor India pressed their respective position beyond a point.

This was reflected in an on-record statement of Indian Finance Minister P. Chidambaram in Durban even before the leaders met.

Chidambaram said India was in favor of "a nearly complete document" before leaders meet for the summit in Brazil in March 2014. He confirmed that the initial authorized capital of the bank was $50 billion, but it was decided not to take a call at the first stage.

The eventual collective victory of BRICS was stamped by the leaders when they held their summit meeting. They reflected their strong support for their finance ministers in the eThekwini (another name for Durban) declaration.

This is the roller-coaster ride of the BRICS bank. But wait! The BRICS bank will take a long time to become a reality. Whenever it is set up eventually, it won't be in a position to hit the ground running and challenge the Bretton Woods system that has dominated the global economy for the past eight decades.

The blueprint of the proposed BRICS will be readied by September and discussed among the grouping's finance ministers on the margins of the UN General Assembly.

After a hectic fine tuning exercise at the finance ministers, it will be presented before the leaders for their consideration at the sixth BRICS Summit in Brazil.

The leaders will have to make a final call on such crucial questions as the capital, membership, governance and domicile issues with regard to the proposed initiative. It is a gargantuan task, but then Rome was not built in a day.



The author is a New Delhi-based journalist-author and a strategic affairs analyst. bhootnath004@yahoo.com

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