BRICS Cooperation: A Programme for Trade and Investment

Introduction

Accounting for approximately 40 percent of global trade, the expanded BRICS includes^[1] key commodity exporters and a diversified basket for trade and investment. Its greatest opportunity lies in fostering cooperation with the African continent and advancing the goals of the African Continental Free Trade Area (AfCFTA). Reviving old markets through new trade routes is essential to respond to the pressures of our times, and BRICS is uniquely placed to inject vitality into this conversation.

An important advantage of the BRICS format is its focus on development and growth issues. Despite strategic and security differences, the diverse membership has consistently advanced economic and development cooperation. Each member has a stake in the other’s economies, creating a shared interest in stability and growth. The inclusion of Egypt, Ethiopia, Iran, Indonesia, Saudi Arabia, and the UAE brings new energy and expands the grouping’s pool of natural and technological resources. In addition, coordination between these members will also create a virtuous circle of development, boosting value creation in Africa for Africa.

Disruptions to old trade routes have already given impetus to discussions around better, multimodal, and “smart” trade routes with paperless customs and smoother trade facilitation. Digitising certification and standards systems must be central to these discussions. Investment in physical infrastructure, such as the India-Middle East-Europe Economic Corridor (IMEC), is equally critical. Identifying suitable projects on which select members of BRICS can work together will require effective coordination.

With the Strategy for BRICS Economic Partnership 2025 expiring this year, this is an opportune moment to design an expanded strategy for the next five- and ten-year periods. The bloc’s expansion to nine members, now accounting for 46 percent of global Gross Domestic Product (GDP), creates a strong basis for greater coordination in the group on trade and investment—and for creating new, and refreshing old, economic corridors. Vietnam’s addition as a tenth member will drive this number further up.

BRICS faces a number of challenges in pursuing this agenda, each of which will be discussed in turn in the following paragraphs.

I. Reclaiming Connectivity

Over-reliance on certain trade corridors, especially the Suez Canal route, has proven inefficient both strategically and practically. In 2024, traffic through the Suez Canal dropped by half—13,200 vessels compared to 26,400 in 2023—largely due to disruptions from the West Asia crisis.^[2] Climate change-induced drought has similarly reduced traffic through the Panama Canal. As trade reroutes through the Cape of Good Hope, transit times and emissions rise, impacting the cost of trade. Insurance costs have also increased. In September 2024, risk premiums for the Red Sea route went up to 2 percent of a vessel from 0.7 percent.^[3] Smaller trading concerns from countries like India were particularly affected by these changes.

A coordinated BRICS response on multimodal connectivity is required to increase supply chain resilience and ameliorate the effect of such shocks. New routes include the International North-South Transport Corridor (INSTC), the India-Middle East-Europe Economic Corridor (IMEC), the Arctic Corridor, and alternatives to the Panama Canal. Several BRICS countries have stakes in these corridors. The UAE, India, and Saudi Arabia are directly involved in IMEC; Russia, Iran, and India in the INSTC; and China, Russia, and India have all shown interest in developing Arctic trade routes. Reducing the cost of transit through the Cape of Good Hope would benefit South Africa, while alternatives to the Panama Canal would reduce the burden on that route and expand trade with Latin America.

Figure 1: The Red Sea, IMEC, and INSTC Trade Routes

Source: Authors’ own, using Data Wrapper^[4]

II. Creating New ‘Mineral Corridors’

Africa holds around 30 percent of the world’s known critical mineral reserves,^[5] with even higher shares for certain commodities—about half of cobalt and manganese reserves, for example. Different parts of the continent are important for specific minerals: cobalt is found in the Democratic Republic of Congo (DRC), while BRICS member South Africa is a major source of manganese. Ensuring economic security and efficiency in the coming decades will require a detailed map of known and potential reserves, along with a coherent plan for their extraction, processing, and trade. Countries at the forefront of designing such plans are now associated with BRICS. Indonesia is now a full member, and Bolivia is a partner country.

The UN Secretary-General’s Panel on Critical Energy Transition Minerals^[6] has identified seven basic principles for a modern critical materials sector, including benefit sharing, transparency, and multilateral cooperation—values that align closely with BRICS priorities.

Mapping the minerals landscape of Africa, Southeast Asia, and Latin America is a vital first step towards creating mineral corridors. Sharing technologies to store and process critical raw materials (CRMs) could be a key advantage of deeper BRICS collaboration. The UAE, as a member of the Organization of Petroleum Exporting Countries (OPEC), brings relevant experience in streamlining and marketing commodities. Securing the supply of CRMs through the BRICS would be a significant development for future growth sectors, where the UAE can actively contribute.

An opportunity thus exists to build “mineral corridors” that secure the trade of critical minerals and that embed technology transfer and value chain participation as key elements from the ground up. Such corridors would go beyond extraction, encompassing processing units, building storage capacity to warehouse minerals at various stages, and investments in end-to-end connectivity linking warehouses to various industries that rely on these resources across the value chains.

III. Renewing Trade Finance

Bridging the trade financing gap is a crucial element of this conversation. One important element is to update credit guarantee mechanisms to galvanise private sector investments. The BRICS Interbank Cooperation Mechanism can work with the New Development Bank (NDB) to innovate new guarantee methods.

Expanding the NDB’s role and commitments and creating partnerships with the Central Banks or Investment Agencies of the expanded BRICS are also imperative. A uniform platform for such cooperation can be devised. Partnerships with the private sector must be expanded. Over time the NDB has given out US$26.5 billion in sovereign loans and US$3.4 billion in non-sovereign loans—highlighting that there is scope to ramp up the level of non-sovereign loans.

IV. Fresh Sources of Infrastructure Finance

According to a report released by the NDB,^[7] emerging market and developing economies (EMDE’s), including BRICS members, will require an estimated US$39 trillion in infrastructure investment between 2021 and 2030. Of this amount, the same report suggests, approximately US$12 trillion is projected to remain unfunded. To reduce this gap, agility in investment would be vital.

Building connectivity and supply chain corridors will require large financing commitments from both the public and private sector. The BRICS Task Force on PPPs and Infrastructure is a government-level Track 1 effort guiding policy on digital technologies, blended finance, and green finance for large-scale projects. Strengthening and supplementing the efforts of the task force is important.

The NDB can deepen its cooperation with central banks and credit guarantee agencies to support these efforts. As per its 2021 Annual Report, transport infrastructure is the largest recipient of NDB financing, receiving US$10.5 billion. Excluding emergency COVID-19 relief (US$9 billion), clean energy and energy efficiency projects follow at approximately US$3 billion.^[8] Water and Sanitation, Social Infrastructure, and Digital Infrastructure, are some other areas of operation of NDB project portfolios.

According to research by the UN Economic Commission for Africa (UNECA),^[9] the continent will need around US$120.8 billion by 2030 for transport equipment (trucks, rail, wagons, maritime vessels, and aircraft) to meet the demands created by AfCFTA. In terms of critical connections internally, road links will require anywhere up to US$80 billion and rail, another US$54.8 billion.

Figure 2: Cost and Number of Equipment Required by 2030 Due to AfCFTA Implementation, by Mode

Source: UNECA 2025^[10]

The expansion of BRICS with new members that have vast experience in some of these sectors, leveraging existing mechanisms and building new bridges between them, is important.

V. Galvanising Private Investment

The UN Trade and Development’s (UNCTAD) 2023 BRICS Investment Report, covering the original five members, found that the grouping attracted US$355 billion in FDI in 2021. The members are both, sources and preferred destinations for investment. This has been further enhanced by the new membership. The new members of BRICS include nations with large investible surpluses, mature financial corporations and funds, and global financial hubs. These can be used to create a BRICS strategy for increasing cross-border flows of private capital.

Besides having councils for business cooperation, there need to be established mechanisms for investment facilitation. At the BRICS Summit in Kazan, Russian President Vladimir Putin proposed a global investment platform for BRICS^[11] to complement the Contingent Reserve Arrangement and the NDB.

Intra-BRICS investment mechanisms must also address currency risks, particularly dollar volatility, by enabling local currency exchanges. Although this has been discussed over the years, a dedicated investment facilitation platform could help coordinate investment opportunities, identify priority infrastructure projects, and align sectoral interests. Additionally, like the BRICS Business Council, a Track-2 mechanism is required to ensure closer coordination and movement on identified projects. The Business Council should consider increasing its work on investment facilitation through a dedicated internal working group instead of clubbing this function with the Trade and Investment working group.

VI. Trade Facilitation and Digitalisation

Trade facilitation is central in ensuring greater development and trade cooperation within the expanded BRICS. Proposals such as a virtual corridor for customs clearances through efficient logistics planning centres need multilateral backing. India, for instance, has announced the creation of the National Trade Network Bharat Trade Net (BTN)^[12] to bring together all departments of government, from customs to taxation, and link them through a seamless common platform for a unified logistics interface. This is part of a push for the greater use of Digital Public Infrastructure.

There are also instances of bilateral agreements on virtual trade corridors, such as the one between India and the UAE. India is developing the Master Application for International Trade and Regulatory Interface (MAITRI),^[13] currently aimed at countries participating in the IMEC and, separately, the UAE. The Bharat-Africa Setu project is another initiative combining physical infrastructure with value-added services across 260,000 points of sale. With proper implementation, it could raise India’s exports to Africa from 6.5 percent to 12 percent by 2030, acknowledging the growth of the continent as a consumer market.^[14]

Ethiopia, now a BRICS member, is expected to benefit from private investment from the UAE, including the development of a digital platform to connect companies with new partners in Ethiopia and, eventually, across Africa. Implementing and scaling such efforts is in the interest of BRICS. Having a Virtual Logistics Corridor in addition to physical infrastructure would reduce trade costs within the bloc and offer a scalable model for other partners.

VII. Preserving Trade from Populist Deglobalisation

BRICS leaders must individually respond to unilateral or protectionist industrial and trade policies. However, transparent and coordinated responses might help ensure that the gains from trade are preserved in a trying period for economic integration. One way to do so is to increase intra-BRICS trade. Preferential trade arrangements between BRICS partners, local currency settlement procedures, cooperation on common standards, amongst other trade promotion policies would contribute to greater trade between the partners.

Another solution is upgrading current information-sharing mechanisms to allow for faster adoption of higher standards in BRICS markets, aiding production and compliance with policies emerging in the global north that impact global trade. This would require greater trade financing to underwrite the costs of higher standards and compliance. Bringing in national banks and increasing the role of the NDB could be explored to subsidise the cost of compliance in the short term.

VIII. Sustaining BRICS

As BRICS expands, its governance structure must evolve to meet the needs of its new partners.

First, there is a need for stable strategies to guide cooperation and growth similar to the one articulated in the Strategy for BRICS Economic Partnership. Second, while the G20 lacks a permanent secretariat, it benefits from support groups like the OECD. BRICS, on the other hand, has none and should actively consider having a virtual secretariat with information on national coordinators across various cooperation mechanisms and platforms. Third, BRICS could adopt a Troika system, where the past, present, and next chairs collaborate to ensure policy continuity. Additionally, the BRICS Business Council can be elevated to an Investment Partnership that brings business know-how and investment to bear on the critical challenges identified by the grouping.

Fourth, the establishment of the Global Logistics Platform Office (GLPO) in Dubai has been actively discussed within the BRICS Business Council,^[15] following its formal endorsement at the 2024 BRICS Summit. Led by DP World on behalf of the UAE, the initiative is currently being set up and has received strong support from BRICS stakeholders. The GLPO will establish the world’s leading global hub that fosters collaboration among BRICS nations, businesses, and academic institutions, building resilient supply chains and enhancing global trade connectivity.

Way Forward

Overall, the BRICS grouping is shaping itself as a key platform for development cooperation, and the African continent is best placed to take advantage of this opportunity. The expansion of BRICS with new members that have vast experience in some of the sectors identified in this report—along with leveraging existing mechanisms and building new bridges between them—is important.

Sectors like logistics and infrastructure, green energy, digital technologies, and critical minerals are only the tip of the iceberg when it comes to potential sectors for intra-BRICS collaboration. Economic diversification to ensure meeting Sustainable Development Goals (SDGs) like water and food security and industrialisation—would also contribute to other goals like poverty alleviation and enabling the green transition, which all BRICS members see as an important goal.

This report is based on the Roundtable Discussion, «Building Resilience Through Trade Corridors», co-hosted by DP World and ORF on 22 January 2025 at Davos, World Economic Forum.

The participants at the roundtable included: Omar A. Al Futtaim, Vice Chairman and Chief Executive Officer, Al-Futtiam Group; Moza Al Futtiam, Chief AI Officer, Al-Futtiam Group; Thiago Barral, National Secretary of Energy Transition and Planning for the Ministry of Mines and Energy, Brazil; Hizmy Hassen, Chief Digital Officer, Apollo Tyres (UK Holdings) Ltd; Busi Mabuza, Chairperson, Industrial Development Corporation of South Africa; Hana Al Rostamani, Group Chief Executive Officer, First Abu Dhabi Bank; Jai Shroff, Chairman and Group Chief Executive Officer, UPL; Rizwan Soomar, CEO & Managing Director, Middle East, North Africa & India Subcontinent, DP World; Parks Tau, Minister of Trade, Industry and Competition, South Africa; Martin Tricaud, Group Head of Investment Banking and Acting Group Head of International Banking, First Abu Dhabi Bank; and Samir Saran, President, Observer Research Foundation, India. 

Endnotes

^[1] Banque De France, “Expansion of BRICS: What Are the Potential Consequences for the Global Economy? | Banque De France,” https://www.banque-france.fr/en/publications-and-statistics/publications/expansion- brics-what-are-potential-consequences-global- economy#:~:text=BRICS+%20carries%20significant%20demographic%20and,with%2028.2%25%20for%20th e%20G7

^[2] UNCTAD, “Suez and Panama Canal Disruptions Threaten Global Trade and Development,” United Nations Conference on Trade and Development, October 22, 2024, https://unctad.org/news/suez-and-panama-canal-disruptions-threaten-global-trade-and- development.

^[3] Jonathan Saul and Carolyn Cohn, “Red Sea Insurance Costs Soar as Houthi Shipping Threats Loom, Sources Say,” Reuters, September 19, 2024, https://www.reuters.com/world/middle-east/red-sea-insurance-costs-soar- houthi-shipping-threats-loom-sources-say-2024-09-19/.

^[4] “The IMEC, INSTC and the Red Sea Route | Created with Data Wrapper,” Create Charts and Maps with Datawrapper, https://www.datawrapper.de/_/e6G4a/?v=2. Note: The map was edited to reflect the correct boundaries of Indian territory.

^[5] UNCTAD, “Critical Minerals: Africa Holds Key to Sustainable Energy Future,” UNCTAD News, June 5, 2024.https://unctad.org/news/critical-minerals-africa-holds-key-sustainable-energy- future#:~:text=Africa%20is%20home%20to%20sizeable%20reserves%20of,abundance%20of%20metals%20ne eded%20for%20electric%20vehicles.

^[6] United Nations, “The UN Secretary-General’s Panel on Critical Energy Transition Minerals | United Nations,” https://www.un.org/en/climatechange/critical-minerals.

^[7] New Development Bank, Scaling Up Development Finance for a Sustainable Future: New Development Bank General Strategy for 2022–2026, NDB General Strategy for 2022–2026, https://www.ndb.int/wp-content/uploads/2022/07/NDB_StrategyDocument_eVersion_07.pdf.

^[8] New Development Bank, Annual Report 2021: Expanding Our Reach and Impact, https://www.ndb.int/annual-report-2021/.

^[9] UNECA, Economic Report on Africa 2025, March 2025, Ethiopia, United Nations Economic Commission for Africa, 2025, https://www.uneca.org/economic-report-on-africa-2025.

^[10] “Economic Report on Africa 2025, March 2025”

^[11] Vladimir Soldatkin and Gleb Bryanski, “BRICS Leaders Tout Joint Finance, Trade Projects at Russian Summit,” Reuters, October 24, 2024, https://www.reuters.com/markets/commodities/russias-putin-outlines-brics-grain- exchange-proposal-2024-10-23/.

^[12] Ministry of Finance, Government of India, https://pib.gov.in/PressReleaseIframePage.aspx?PRID=2098387.

^[13] Ministry of Ports, Shipping, and Waterways, Government of India. https://pib.gov.in/PressReleasePage.aspx?PRID=2106662.

^[14] Yara Abi Farraj, “DP World, India Launch Bharat Africa Setu to Double India-Africa Trade,” Economy Middle East, April 11, 2025, https://economymiddleeast.com/news/dp-world-india-launch-bharat-africa-setu-to-double- india-africa-trade/.

^[15] “BRICS Business Council,” https://bricsbusinesscouncil.co.in/bbc-publication.php.