Why in News

• The UAE, a BRICS member since January 2024, is using India’s 2026 BRICS Chairship to promote stronger economic cooperation and shared growth, while highlighting the UAE-India Comprehensive Economic Partnership Agreement (CEPA) as a successful model of economic partnership.

What Is BRICS and Why Does the UAE’s Role Matter?

• BRICS (Brazil, Russia, India, China, South Africa, now expanded to include the UAE, Egypt, Ethiopia, Iran and Indonesia) is a grouping of major emerging economies seeking to reform global governance and promote South-South cooperation.
• The UAE’s entry added a Gulf economic hub with strong capital reserves, logistics infrastructure and connectivity networks to a grouping historically dominated by large landmass economies — BRICS is now judged less on political counterweight and more on economic delivery.

1. Diversity as a Strength, Not a Weakness

• BRICS members bring different economic structures — producers, capital sources, investment destinations and manufacturing hubs. This diversity, managed well, creates complementarity rather than competition — a departure from the traditional model of blocs built around similar-sized economies.

2. Role of the New Development Bank (NDB)

• The NDB, BRICS’ own multilateral lending institution, has approved over $40 billion in financing since creation, largely for infrastructure and sustainable development — an attempt to build an alternative development finance architecture, reducing dependence on the World Bank and IMF.

3. UAE-India CEPA as a Case Study

• One of India’s fastest-negotiated trade deals — non-oil bilateral trade grew 17% in 2025, crossing $76 billion, with both countries targeting $200 billion in bilateral trade by 2032. The relationship extends beyond trade into investment, education, tourism, innovation and people-to-people ties.

4. The UAE’s Structural Advantages in Connectivity

• Non-oil sectors contribute almost 79% of GDP (2025); world-class ports, airports and logistics networks link Asia, Africa and Europe; sovereign wealth assets exceed $2.9 trillion; and 38 CEPAs already concluded — showing how a small state can exercise outsized economic influence through connectivity infrastructure rather than population or landmass.

5. India’s 2026 BRICS Chairship — the RICS Theme

• India’s chairship theme — Resilience, Innovation, Cooperation, Sustainability (RICS) — aims to push BRICS from dialogue to delivery: strengthening the multilateral trading system, improving connectivity/supply-chain resilience, and promoting sustainable development financing.

• Diversification of partnerships: Simultaneous engagement with BRICS (multilateral) and the UAE (bilateral) reflects India’s multi-alignment foreign policy.
• Economic gains: CEPA has delivered tangible trade growth, positioning the UAE as a gateway for Indian exports to Africa and West Asia via its re-export hub status.
• Strategic depth: Continued NDB cooperation gives India access to alternative development finance, reducing overreliance on Western-controlled institutions.
• Soft power and diaspora linkage: The large Indian diaspora in the UAE strengthens trust-based, people-to-people economic ties.

• Divergent interests within BRICS: Differing positions of China, Russia and India on global governance reform slow down consensus-building.
• Trade restriction environment: Rising protectionism, tariff wars and de-risking policies increase costs and uncertainty.
• Implementation gap: BRICS is often criticised for more talk than action — NDB’s lending capacity remains far smaller than the World Bank or IMF.
• Overlapping groupings: India must balance BRICS with Quad, G20, IMEC and other frameworks — raising questions of strategic coherence.
• Geopolitical sensitivities: BRICS’ expansion (including Iran) invites scrutiny of India’s ties with countries under Western sanctions.