Accord on fund against currency fluctuation; stress on talks to resolve Iran issue

In a sign that the world’s five most influential non-Western countries have moved away from political rhetoric and a loose arrangement of meeting once a year, the BRICS countries at their Fifth Summit, which ended here on Wednesday, decided to set up an infrastructure-oriented development bank, sought a Director General for the World Trade Organisation (WTO) from the developing world, set up a $100 billion fund for themselves to guard against currency fluctuation, wanted UNCTAD to reorient itself and ruled out any other option but a negotiated solution for the Iran nuclear issue.

But the Summit fell short of initial expectations on making a firmer endorsement for permanent UN Security Council seats for India, Brazil and South Africa with two diplomats from countries other than India who were involved in the negotiations expressing surprise over New Delhi not pushing more firmly on the issue.

However, in a gesture to India, BRICS reiterated the need for quickly completing talks on a Comprehensive Convention on International Terrorism, a concept first mooted by New Delhi.

The Summit also displayed a distinct non-Western tendency by acknowledging the important role that state-owned enterprises played in their economies and resolving to encourage them to interact with each other. The leaders also decided to hold a standalone meeting of BRICS officials or Ministers to promote this aim.

The BRICS Summit acknowledged the lacunae in their functioning and resolved to set up a virtual secretariat to impart continuity and manageability to the large number of BRICS deliberations at various levels — academic, think tanks, National Security Advisers and various Ministers.

But it was not all smooth sailing as the deliberations on the BRICS Bank showed, said diplomats privy to the negotiations that carried late into Tuesday night and resumed in the morning on Wednesday. No consensus was achieved on the quantum of seed money. China wanted each country to contribute up to $100 billion and promised to make up for the shortfall if any country was unable to cough up the entire amount. Brazil did not take to the proposal at all, while South Africa tried to remain neutral, and India and Russia pressed for more deliberations.

Finally, all five felt the issue should be discussed among officials and Ministers, and the concept reviewed by the five principals in September on the sidelines of the St. Petersburg G-20 summit.

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