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PM Modi to launch engagement with BRICS leaders

PM Narendra Modi will launch his first multilateral engagement with BRICS leaders, giving top priority for the establishment of the BRICS development bank with equal share holding for all the five members.

india Updated: Jul 14, 2014 15:08 IST

Prime Minister Narendra Modi will launch his first multilateral engagement with BRICS leaders, giving top priority for the establishment of the BRICS development bank with equal share holding for all the five members.

India is keen on the issue of equal share holding since it doesn't want a repeat of the distortions that have crept into Bretton Woods institutions like IMF, World Bank and the Asian Development Bank in which rich countries like the US and Japan have a strangle hold.

Ahead of the BRICS Summit on Tuesday in this north eastern coastal city, Modi will meet Chinese President Xi Jinping and Russian President Vladimir Putin on the sidelines to discuss the issue relating to the New Development Bank.

He will also discuss the possible outcomes of the summit on other issues like reforms of the UN Security Council and international financial architecture.

Sources said India's primary goal is equal shareholding for all the members -- Brazil, Russia, India, China and South Africa.

The BRICS Development bank, an idea which was conceived in Delhi in 2012 and approved in Durban last year, is to be set up with an initial corpus of USD 50 billion, with scope for expansion upto USD 100 billion when new members are added.

For the initial USD 50 billion, India wants equal contribution by all the five members of USD 10 billion. This is because India doesn't want the development bank to fall into the ownership pattern of IMF and WB, with a distorted share holding.

The other priority for India are about the presidency of the bank and the name to be given for it. Apparently, India would like it to be called the New Development Bank, an expression used by Modi in his departure statement on Sunday.

"I also look forward to our discussions to further advance intra-BRICS economic cooperation and our collective efforts to advance global economic stability and prosperity.

In particular, I look forward to the successful conclusion of major BRICS initiatives like the New Development Bank and the Contingent Reserve Arrangement, which have seen significant progress since their launch in New Delhi in 2012," Modi said in the statement.

"These initiatives will support growth and stability in BRICS and also benefit other developing countries," he said.

Read:Modi leaves for BRICS summit in Brazil; China, Russia talks on cards

India wants the modalities for the establishment of the bank through a simple route and not a complicated one.

It wants to avoid the pitfalls of the Bretton Woods institution of one who pays more calls the tune.

During his meetings with Chinese and Russian presidents, bilateral issues may also come up but no big ticket items are likely to be decided since it would be a get to know meeting.

Both Xi and Putin are likely to visit India in September and November-December respectively this year.

While with Xi it will be Modi's first meeting, he has already met Putin on earlier occasions.

Read:Modi spells out foreign policy approach ahead of BRICS summit

With China, Modi may discuss the need for maintaining peace and tranquility along the border so that bilateral problems can be resolved in an amicable manner.

Bilateral trade will also come up for discussion with the Chinese leader and India is keen that the present imbalance in trade should be resolved. Modi is also keen on Chinese investment in India.

Russia is also keen to provide technology and is looking for a new site in India for setting up a civil nuclear plant because Haripur in West Bengal is not working out.

Already the nuclear liability issues over Kudankulam plant 3 and 4 units have been resolved.

The BRICS summit theme, "Inclusive Growth; Sustainable Development", will enable India to shape the post-2015 Development Agenda being discussed in the United Nations.

The Prime Minister is accompanied by a high-level delegation that includes minister of state for finance Nirmala Sitharaman, national security adviser AK Doval, foreign secretary Sujatha Singh and finance secretary Arvind Mayaram.

First Published: Jul 14, 2014 13:46 IST