After the new regime presents its maiden budget, Prime Minister Narendra Modi will begin to seriously engage the emerging world economies at Fortaleza. Close cooperation among the emerging economies has become imperative as the world is yet to recover from the crisis of August-September 2008.

The sixth annual BRICS Summit at Fortaleza on the northeastern coast of Brazil on July 15 is expected to outline the approach of the emerging economies to the ninth summit meeting of G-20 leaders scheduled in mid-November in Brisbane, Australia, and suggest inputs for the Sustainable Development Goals to be formulated in 2015.

Apart from having bilaterals with BRICS leaders, Prime Minister is scheduled to meet the leaders of 11 South American countries – Argentina, Bolivia, Chile, Colombia, Ecuador, Guyana, Paraguay, Peru, Surinam, Uruguay and Venezuela on July 16 in Brasilia. This would enable India to conquer the last frontiers of diplomacy, an initiative launched with the first India-Latin America and Caribbean foreign ministers’ dialogue in August 7, 2012 in New Delhi.

The BRICS group (Brazil, Russia, India, China and South Africa) has a definite role in bailing out the stagnant world economy. UNCTAD’s recent World Investment Report projects that foreign direct investment (FDI) inflows would increase to the developing world and Asia will continue to receive investment inflows. Asia attracted 30 per cent of global FDIs in 2013. India experienced 17 per cent increase in FDI inflows in 2013 to $ 28 billion, but macro-economic uncertainties remain a major concern for investors.

After the 2012 slump, global FDI returned to growth with inflows rising per 9 per cent in 2013 to $ 1.45 trillion. The report projects global FDI to rise to $ 1.6 trillion in 2014 with relatively larger increases in developed countries. It, however, noted that fragility in some emerging economies and risks related to policy uncertainty and regional instability may negatively affect the expected upturn in FDI.

The developing world needs investments in the range of $3.3 trillion to $4.5 trillion per year mainly for basic infrastructure. The UNCTAD report noted that apart from China maintaining its lead in attracting FDIs, Russia has recently emerged as country in attracting investments. It is thus contextual and appropriate that the extension of a gas pipeline from Russia through China to across Himalayas to India should figure in the BRICS agenda.

During the recent visit of Russian Deputy Prime Minister Rogozin to India, talks on strengthening energy cooperation between the two countries took place between him and External Affairs Minister Sushma Swaraj. Russian aided Kudankulam-1 nuclear power plant attained full capacity of 1000 MW on June 7 and Kudankulam-II is likely to attain criticality by the end of this year. Technical matters are being discussed for Kudankulam-III & IV reactors.

The Special Envoy of the Chinese President, Wang Yi visited India and expressed his country’s desire to deal with the new government in India. The subsequent visit of Vice President Hamid Ansari to China resulted in signing of a MoU for cooperation on industrial parks in India.

The meeting between Prime Minister Modi and Russian President Vladimir Putin and Chinese President Xi Jinping may result in the ambitious initiative of trans-Himalayan Russia-China-India gas pipeline.

Another issue likely to be taken up seriously is the setting up of a BRICS Development Bank, the modalities for which are yet to be finalised. The idea to set up this bank outside the framework of the Bretton Woods system to foster development process in the Third World was conceived at the New Delhi Summit of BRICS in 2012. China is interested in hosting the bank in Shanghai, while South Africa is interested it being headquartered at Durban.

India is interested in an endorsement from BRICS on the need for reforms in the UN Security Council to reflect contemporary realities. Three member countries, Brazil, India and South Africa are contenders for a permanent seat in the UNSC. Russia has already backed India’s candidature.

The BRICS leaders are expected to discuss issues relating to energising global trade by activating the WTO, common stand on global climate issue, sustainable development and global and regional issue like those relating to Iraq and Syria.

BRICS account for more than a quarter of the world’s land mass, 40 per cent of the global population and a combined GDP of $24 trillion at PPP. The group has natural and financial resources and large consumer base to be able to generate demand so as to be able to give momentum to manufacturing, innovation and technological advancement. BRICS has undertaken about 20 areas of activity.

The idea of a group BRIC – Brazil, Russia, India, China – was first conceived by Goldman Sachs way back in 2001. The first meeting in the BRIC configuration happened in 2006 when foreign ministers of the four countries met in New York on the margins of the UN General Assembly. The first summit was held in 2009 and in 2010 a need was felt to make the group more representative in character across continents; hence South Africa was invited to join.

Thus in 2011, BRIC transformed into BRICS. The group has completed its first cycle by each member country hosting a summit. It now enters its second cycle with Brazil hosting the summit for the second time. Argentina and Indonesia have expressed a desire to join the group. The world is watching how the countries take BRICS to its next level at Fortaleza.