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Updated: April 15, 2011 09:16 IST

BRICS nations make the first move with local currencies

Sandeep Dikshit
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From left to right, BRICS leaders, Prime Minister Manmohan Singh, Russian President Dmitry Medvedev, Chinese President Hu Jintao, Brazilian President Dilma Rousseff and South African President Jacob Zuma at the one-day summit in Sanya, China on Thursday.
PTI From left to right, BRICS leaders, Prime Minister Manmohan Singh, Russian President Dmitry Medvedev, Chinese President Hu Jintao, Brazilian President Dilma Rousseff and South African President Jacob Zuma at the one-day summit in Sanya, China on Thursday.

For issuing credit or grants among each other; push for anti-terror law

The BRICS nations inked a pact to use their own currencies instead of the U.S. dollar in issuing credit or grants among each other and pushed for the early conclusion of an India-initiated U.N. comprehensive anti-terror law.

“Our designated banks have signed a framework agreement on financial cooperation, which envisages grant of credit in local currencies and cooperation in capital markets and other financial services,” Prime Minister Manmohan Singh said at a news conference here on Thursday.

The decision came after a restricted session that deliberated on the international situation, financial situation, climate and security.

This stand was also endorsed by Chinese President Hu Jintao and his Brazilian, Russian and South African counterparts Dilma Rousseff, Dmitry Medvedev and Jacob Zuma respectively.

The summit also spoke of a reserve currency other than the dollar but officials pointed out that the road was long and required extensive deliberations among all the major countries besides the BRICS grouping.

The joint declaration in this respect said: “Recognising that the international financial crisis has exposed the inadequacies and deficiencies of the existing international monetary and financial system, we support the reform and improvement of the international monetary system, with a broad-based international reserve currency system providing stability and certainty.”

“The era demands that the BRICS countries strengthen dialogue and cooperation,” said Mr. Hu.

At a press briefing, Manbeer Singh, Secretary (Economic Relations) in the Ministry of External Affairs, said: “We want a broad-based international reserve currency system and change in the rubrics of the international monetary and economic governance. We are looking for a substitute, not an alternative.”

On the anti-terror law, the declaration reiterated the BRICS' “strong condemnation of terrorism in all its forms and manifestations and stress[ed] that there can be no justification, whatsoever, for any acts of terrorism.”

It said, “In this context, we urge early conclusion of negotiations in the U.N. General Assembly of the Comprehensive Convention on International Terrorism and its adoption by all Member-States.”

The proposed treaty criminalises all forms of terror but was stalled due to differences over the definition of the word terrorism. But the BRICS leaders said they were “determined to strengthen our cooperation in countering this global threat.” They identified cyber crime as another growing threat.

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