Brics bank

All about BRICS AND BRICS

1. INTRODUCTION BRICS stands for BRAZIL, RUSSIA, INDIA, CHINA, SOUTH AFRICA. The idea of the BRICS was formulated by Chief Economist at Goldman Sachs Asset Management , Jim ' O Neill, in a year 2001. Officially, it was admitted as BRIC nation on 24 December, 2010. BRICS is the internal political organization of lending emerging economics. Its five members are all developing industrialized countries. It is the fastest growing and emerging economies.

2. FROM BRIC TO BRICS South Africa was asked to join the BRIC group of major emerging markets. South Africa stands at a unique position to influence African economic growth and investment. The grouping was originally known as BRIC before the inclusion South Africa in 2010. With the entrance of South Africa, at the 3 rd BRIC Summit, in April 2011, the BRIC became BRICS, with capital S.

3. OBJECTIVES Its main objective are to corporate between the member nations for development, provide financial assistance, support various projects, infrastructures, etc. The BRICS group acts as a bridge between developed and developing countries. They are attempting to promote the liberalization of the international economic order. The BRICS group also plays an increasingly important role in assisting developing countries in gaining an advantages in trait and climate change negotiation.

4. BRICS BANK : INTRODUCTION The New Development Bank (NDB), formerly referred to as the BRICS Development Bank, is multilateral development bank operated by the BRICS states (Brazil, Russia, India, China, South Africa) as an alternative to the existing American and European-dominated World Bank and International Monetary Fund. Each participant country holds an equal number of shares and equal voting rights, and none of the countries will have vote power. BRICS states have 43% of the world ' s population, 20% of the world ' s coverage and $18.486 trillion of combined GDP.

5. HEADQUARTER, MANAGEMENT AND ORGANISATION: The bank is headquartered in Shanghai, China. K.V.KAMATH from India, is the 1 st chairperson of the bank. According to the Articles of Agreement, the main organs of the bank are: Board of Governors Board of Directors President and Vice-Presidents The president of the bank shall be elected from one of the founding members on a rotational basis, and there shall be at least one Vice President from each of the other founding members.

6. HISTORY The idea for setting up the bank was proposed by India at the 4 th BRICS summit in 2012 held in Delhi. BRICS leaders agreed to set up a Development Bank at the 5 th BRICS summit held in Durban, South Africa on 27 th March, 2013. On 15 th July, 2014, the first day of the BRICS summit held in Fortaleza, Brazil. The BRICS states signed the agreement on the New Development Bank. The 7 th BRICS summit in July 2015 marked the entry into force of the Agreement. On 11 th May, 2015, K. V. Kamath was appointed as President of the Bank. He was replaced by Marcos Prado Troyjo from Brazil since 7 th July, 2020.

7. OBJECTIVES The bank aims to contribute to development plans established nationally through projects that are socially, environmentally and economically sustainable. Taking this into account, the main objectives of the NDB can be summarized as follow: To utilize resources at its disposal to support infrastructure and sustainable development projects, public or private, in the BRICS and other emerging market economies and developing countries.

8. OBJECTIVES The bank shall support public or private projects through loans, guarantees, equity participation and other financial instruments. It shall also co-operate with international organizations and other financial entities. To provide technical assistance for the preparation and implementation of infrastructure and development projects to be supported by the bank. The bank will be an additional source of long term finance for infrastructure projects in India.

9. MEMBERSHIP The founding members of the bank are Federative Republic of Brazil, the Russian Federation, the Republic of India, the Peoples Republic of China and the Republic of South Africa. The membership shall be open to members of the United Nations, in accordance with the provisions of the Articles of Agreement of NDB. It shall be open to borrowing and non-borrowing members.

10. CAPITAL The New Development Bank shall have an initial subscribed capital of US $50 billion and an authorized capital of US $100 billion. The initial subscribed capital is to be equally distributed among the founding members. Each member cannot increase its share of capital without all other four members agreeing. The bank will allow new members to join but BRICS capital share cannot fall below 55%.

11. SHARE-HOLDING STRUCTURE

12. FUNCTIONS OF NDB Support public or private projects through loans Guarantees for equity participation Better understanding of the borrowers mindset Cooperate with international organization and other financial entities Provide technical assistance for projects

13. INDIA IN FUTURE BANK Emerging markets opportunities High growth rates Huge investment in infrastructure Huge middle class boosting demand Increased foreign direct investment High potential for outstanding work

14. PROBLEM ANALYSIS Political conflicts among BRICS states Popularity of World Bank and IMF Population of BRICS countries are taken 43% population Global financial crisis Big role of dollar in trade Declining GDP growth Limited liabilities

15. CONCLUSION BRICS nations have the potential and resources to form a powerful economy with greater opportunities than any other nation. A strong BRICS can also have more influence in other multilateral forums such as WTO, World Bank, etc. If the government of India takes speedy and effective measures to overcome these challenges in FDI attraction and given a few years with developments India will definitely overtake such nations.

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