BRICS Future in Doubt as China and India Remain Divided, Says Economist Jim O'Neill

Russian President Vladimir Putin is using the BRICS summit to showcase Russia’s growing ties with Asian powers, positioning the bloc as an alternative to Western dominance. However, Jim O'Neill, the economist who coined the BRIC acronym in 2001, remains skeptical about the group's ability to challenge the global economic order, especially with China and India at odds.

According to O'Neill, without serious cooperation between China and India, the dream of BRICS emerging as a global economic force is unlikely to materialize.

Key Takeaways:

• Symbolic Nature of BRICS: O'Neill describes BRICS as a "symbolic annual gathering" that lacks the cohesion to become a significant global economic player, largely due to ongoing tensions between China and India.

• Economic Impact Limited: While BRICS represents 45% of the world's population and 35% of the global economy (PPP), China accounts for more than half of the group’s economic power, with little meaningful collaboration between China and India.
• Alternative to the U.S. Dollar?: O'Neill dismisses the idea of a BRICS currency challenging the U.S. dollar as impractical without substantial cooperation on trade and economic policy between member countries.

Why BRICS Is Falling Short: Internal Divisions Between China and India

Despite its potential, O'Neill believes BRICS’ ability to emerge as a genuine global force hinges on cooperation between its two largest members—China and India. The lingering border disputes and ongoing political tensions between these nations create a major obstacle for the bloc’s growth.

"Until China and India stop confronting each other and start collaborating, the BRICS group will remain more of a symbolic entity rather than a global economic force," O'Neill said in a recent interview with Reuters.

For years, China and India have been at odds over territorial disputes, with the situation escalating into a violent clash in 2020. Although the two nations held formal talks at the BRICS summit this week, distrust remains high. Without cooperation between these two major economies, the future of BRICS appears uncertain.

BRICS Expansion: A Double-Edged Sword

At the BRICS summit, Russian President Putin revealed that over 30 nations have expressed interest in joining the group, but O'Neill warns that expanding BRICS might complicate matters further.

"Adding more members without addressing the internal divisions within the current group could dilute the focus and make decision-making even harder," O'Neill added.

Despite these concerns, several countries, including Egypt, Ethiopia, Iran, and the UAE, are already being considered for membership. Saudi Arabia has also expressed interest in joining BRICS.

BRICS Currency: A Distant Dream

Amid growing geopolitical tensions, Russia has been advocating for the creation of a BRICS-based alternative to the U.S. dollar for international trade. However, O'Neill argues that such a currency is highly dependent on China’s economic power and would not be sustainable without serious economic reforms within the group.

"If BRICS countries truly wanted to challenge the dollar, they would start by removing trade barriers between themselves. But as long as China and India remain divided, this goal is far-fetched," O'Neill stated.

He further noted that despite years of discussions about dollar alternatives, none of the BRICS nations have made any serious progress toward developing a viable substitute.

A Path Forward: Tackling Global Issues

For BRICS to become relevant on the global stage, O'Neill suggests that the group should focus on addressing critical issues like climate change, global health, and economic inequality. He emphasized that without taking on major global challenges, the bloc would remain ineffective.

"BRICS should stop trying to position itself as an alternative to Western powers and instead work on solving real issues that affect humanity," O'Neill said. "That’s where true global leadership lies—collaborating to find solutions for issues like infectious diseases, climate change, and economic disparity."

Challenges Ahead: China and India at the Core

The strained relationship between China and India is a significant hurdle to BRICS’ progress. While both countries have pledged to enhance cooperation during the summit, their differences continue to hinder economic collaboration within the group.

Until these two nations reconcile their political and territorial disputes, the BRICS group’s ability to make meaningful global contributions remains limited.

Conclusion: Will BRICS Ever Realize Its Full Potential?

As the BRICS summit continues, the world is watching to see if this bloc of emerging powers can overcome its internal challenges and work together to reshape the global economic order. However, without cooperation between China and India, the group’s future as a serious global player remains in doubt.

In the words of Jim O'Neill, "I will take BRICS seriously when I see signs that China and India are truly working together instead of confronting each other."

As it stands, the BRICS group still has a long way to go before it can rival established economic forums like the G7 or G20. The next steps for the group will be crucial in determining whether it remains a symbolic gathering or transforms into a genuine force for global change.