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By Mihir Sharma / Bloomberg Opinion
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It likes to think of itself as the developing world’s equivalent of the G7. Yet unlike the G7, the BRICS bloc — designed for Brazil, Russia, India, China and South Africa, but now expanded to 11 members — has sharply diverging interests. It includes energy exporters like Saudi Arabia and the United Arab Emirates (UAE), as well as importers like India; material-hungry manufacturing giants like China, and commodity superpowers like Brazil; moderate democracies like Indonesia, and extremist theocracies like Iran.
However, if there is one thing that almost all of them have in common, it is that they want to ensure the grouping’s most powerful member, China, does not dominate. Beijing might want to use its influence over global trade to increase the use of the yuan, but India has made it clear that replacing the US dollar as the global reserve currency is not part of the BRICS’ mandate. Some of the newer members, such as the UAE, are close US allies.
Of course, US policy is not universally popular, either. When is it ever? At the BRICS meeting this week in Brazil, leaders jointly condemned the “indiscriminate rising of tariffs,” in a swipe at US President Donald Trump’s trade policy. However, Trump was not criticized half as harshly as the Europeans were: Their carbon border taxes were described as “unilateral, punitive and discriminatory protectionist measures that are not in line with international law.”
That is partly because the global south is divided on tariffs, just as it is on everything else. Yes, it might be unfair that poorer countries are losing market access to richer ones — that is a violation of normal economic logic, in which the poor sell to the rich and everyone is better off as a result. However, most in the developing world might well welcome tariffs on China; they agree its stranglehold on global manufacturing must somehow be loosened. They are saying: We are not going to condemn US tariffs targeted at China as strongly as we do European barriers, because doing so would mean playing Beijing’s game.
The only thing that could push these diverse nations together is if the US makes a real effort to present itself to them as a shared target. Unfortunately, that is exactly what Trump apparently wants to do. He responded to the Rio summit by threatening an extra 10 percent tariff on “any country aligning themselves with the Anti-American policies of BRICS.”
That plays into China’s hands. Nothing would strengthen Beijing’s case to lead the emerging world more than US efforts to paint a basically innocuous, ineffectual grouping as “anti-American.”
Indian Prime Minister Narendra Modi certainly would not participate in a summit that was designed to be anti-American. If anything, India’s participation in the BRICS is meant to highlight its own bid for leadership of the global south — or, at least, its determined attempt to deny that position to Beijing.
On his way to Rio, Modi stopped off in multiple developing countries — Namibia, Ghana, Trinidad and Argentina. It is an interesting group, one that clarifies India’s global south strategy. The diaspora is one quiver in Modi’s bow: People of Indian descent are the largest ethnic group in Trinidad and Tobago. India’s hunger for commodities is another component — imports of cooking oil from Argentina have soared since Ukrainian sunflower oil was taken off the market by Russia’s invasion in 2022. Ghana exports more to gold-mad India than anywhere else. The global race to access the raw materials of the future is part of it as well. Indian companies have been pushed to find ways to process lithium and other critical minerals in Argentina and Namibia.
It is just not possible for India to immediately substitute for China — or anyone else — as an economic partner in most parts of the world. However, a strategy that is more concentrated geographically and focused on sectors like critical minerals and agricultural processing might work, particularly because India’s private sector-driven economic model is far more inclusive and open to local value creation than China’s approach.
The real lesson of the Rio BRICS summit, and Modi’s meandering journey to it, is that it is not meant to be a forum for the global south to be anti-American. It is better understood as a place where countries bid to lead the global south. Not all those propositions are designed around diminishing the US role in the world. Such competition is healthy, for the West as well as the South. Trump should not push a group so distrustful of each other into forming a common cause instead. Instead, make some friends, and keep them — or China will steal them from you.
Mihir Sharma is a Bloomberg Opinion columnist. A senior fellow at the Observer Research Foundation in New Delhi, he is author of Restart: The Last Chance for the Indian Economy. This column reflects the personal views of the author and does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
