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BRICs mull setting up development bank

October 02, 2012 14:01 IST
Think tanks of five member - Brazil, Russia, India, China and South Africa- BRICS bloc, representing the emerging economies, reached consensus on creating a BRICS development bank to complement existing global financial institutions like World Bank.

Liu Youfa, deputy director of the China Institute of International Studies, said: "At the previous forum before the
BRICS summit meeting in March, we were still discussing whether to create this bank, but now we are talking about how to create this bank.

"The consensus was reached between experts from the think tanks from five emerging world economic powers during the two two-day forum held this week at Chongqing city in China," said Chinese state run Xinhua news agency.

The 2012 BRICS Think-Tanks Forum is a follow up to the understanding reached at the BRICS leaders summit in New Delhi in March this year to consider the possibility of creating a new development bank.

It was decided at the summit to convene expert meetings to explore the possibility. Being the first think-tank forum of its kind, briefed to advise governments of each
BRICS country, experts at the event said that their agreement on the necessity and practicality of creating the bank would be presented to officials for further action.

HHS Viswanathan, a fellow of India's Observer Research Foundation, who took part in the meeting, said no report was worked out at the meeting.

But, he said, discussion will surely be included in the report of the next forum, set to take place in South Africa before the next BRICS summit to be held there in 2013.

India expects to see the bank established as soon as possible, he was quoted by Xinhua as saying. Although no timetable was set, a road map has become clear after this week's forum and all five sides are clear what to do next that is to figure out the form of organisation for the bank, equity shares, head office and other issues, he said.

Liu Youfa said think tanks are a preliminary step in government policy-making and the influence of their ideas in part depends on their feasibility and thoroughness.

According to Liu, the consensus reached at the forum included the need to build a legal framework, establishment of a theoretical framework and the discussion on technical issues.

KJM Varma in Beijing
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