Two major international developments, though totally unrelated, have vital implications for each other.
One
was the establishment of BRICS Bank at the just concluded BRICS Summit
at Fortaleza in Brazil, with the laudable objective of facilitating
infrastructure development in the member nations to begin with, as well
as to provide extra forex to the member nations in the event of a
crisis. It is also expected that the availability of funds by way of
Contingency Reserves Arrangement to the
tune of $100 billion, will help reduce market volatility in the member
nations, as the US gradually withdraws its stimulus, besides of course
facilitating better economic relationship among BRICS member states.
The
second development, a tragedy which has shocked the world, is the
downing of MH 17 in eastern Ukraine. Russia is a common factor in both
these developments, for one being a member of BRICS, and secondly, being a
principal player in the Ukrainian crisis. In the recent weeks Russia has been
accused of transferring heavy weaponry to the insurgents- like the
surface-to-air Bak missile system, thought to have brought down
the MH 17.
As
Russia now finds itself isolated and in the midst of an unfavorable world opinion,
regarding its role (indirect of course) in the downing of MH 17, the
BRICS leadership could be at crossroads regarding their respective
positions in the international forums vis-a-vis Russia, with specific
reference to the Ukrainian crisis. This crisis has revealed its
disastrous potential for other unrelated players as well, through the MH
17 tragedy.
That
an important member of BRICS could defy the well established
international order, and arm the insurgents in a sovereign state to
further its interests vis-a-vis that state, can by itself prove to be a
huge dampener for the BRICS member nations, in their quest to forge mutual trust among
each other, something which is a critical minimum foundation, on which
the very edifice of BRICS Bank can sustain itself.
It
would be worthwhile recalling that
way back in 1979, when the erstwhile Soviet Union moved into
Afghanistan, the US through its ally Pakistan, armed the insurgents in
Afghanistan to enable them counter the Soviet forces. Two decades later,
on Sept 11 2001, the world witnessed the worst possible terror strike in modern history, which had its repercussions in the world economy as a whole.
The US was forced to actively intervene in Afghanistan to wipe out the
epicenter of world terrorism, an outcome of proxy war played out in the
early eighties. That the US is struggling to get out of Afghanistan is
also worth observing.
This
has important lessons for Russia as
well, besides for the world community as a whole, which cannot be
insulated from the side effects of the ill conceived actions in any part
of the world by the superpowers, something which has been well
established by now, with Iraq being another manifestation.
Now,
how would the BRICS leadership respond to such a development in
international geopolitics, and would the much required cohesiveness
facilitated by a glue called 'trust' remain unscathed among the BRICS
member states? It would be something to be curiously watched in the near
future.
That the ultimate implications of such developments would be on BRICS Bank as well, needs no further elaboration.
