​ Stick together: on India and Brazil and their ties

Context & The Gist

The article discusses the recent visit of Brazilian President Luiz Inácio Lula da Silva to India, highlighting the growing strategic partnership between the two nations. This comes at a time of increasing geopolitical uncertainty, particularly due to protectionist trade policies emanating from the US. The core thesis is that India and Brazil, as key players in the Global South, are recognizing the need to strengthen their cooperation and ‘unionize’ to navigate these challenges and advocate for a more equitable multilateral order.

Both countries are seeking to diversify their trade relationships and reduce dependence on single nations, particularly China, while also pushing for reforms in global governance structures like the UN Security Council.

Key Arguments & Nuances

• US Trade Policies as a Catalyst: The US Supreme Court's ruling on tariffs, and the history of high tariffs imposed on India and Brazil, are driving both nations to seek alternatives and strengthen bilateral ties.
• ‘Unionizing’ vs. Bilateral Deals: Lula’s call for countries to “unionize” rather than negotiate individual deals with the US reflects a concern that smaller nations are disadvantaged in one-on-one negotiations.
• BRICS & Multilateralism: The article emphasizes the importance of groupings like BRICS, IBSA, and the G-4 as platforms for India and Brazil to coordinate their efforts and advocate for a more inclusive global order.
• Diversification Beyond China: Agreements on critical minerals, steel mining, and digital cooperation signal a deliberate attempt to diversify supply chains and reduce reliance on China.
• Impact of US Elections: Lula’s potential absence from the BRICS summit due to election campaigning adds a layer of uncertainty to future cooperation.

UPSC Syllabus Relevance

• International Relations: India’s foreign policy, relations with Brazil and the US, BRICS and other multilateral groupings.
• Economy: Trade agreements, diversification of trade, impact of global trade policies on India.
• Governance: India’s role in global governance, advocating for reforms in international institutions.

Prelims Data Bank

• BRICS: An acronym for Brazil, Russia, India, China, and South Africa. It is a grouping of leading emerging economies.
• IBSA: India-Brazil-South Africa Forum, a trilateral, South-South cooperation mechanism.
• G-4 Nations: India, Brazil, Germany, and Japan – countries that support each other’s bids for permanent seats on the UN Security Council.
• UN Security Council (UNSC): The United Nations Security Council is one of the six principal organs of the United Nations, charged with the maintenance of international peace and security.
• Carbon Border Adjustment Mechanism (CBAM): An EU policy that imposes a carbon price on certain goods imported from countries with less stringent climate policies.

Mains Critical Analysis

The strengthening India-Brazil partnership is a strategically important development, particularly in the context of a shifting global order. A PESTLE analysis reveals the following:

• Political: The shared concerns over US trade policies and the desire for a more multipolar world are driving the partnership. Both nations are also navigating domestic political challenges (Lula’s upcoming elections, India’s own political landscape).
• Economic: The goal of doubling trade to $30 billion by 2030 is ambitious but achievable, particularly with agreements on critical minerals and diversification of supply chains. However, logistical challenges and infrastructure gaps could hinder progress.
• Social: Increased cooperation in areas like digital technology and skills development could benefit both societies.
• Technological: Collaboration in digital cooperation is crucial for both nations to leverage the benefits of the digital economy.
• Legal: Streamlining trade regulations and addressing legal barriers to investment will be essential for realizing the full potential of the partnership.
• Environmental: Cooperation on biofuels and alternative energy sources aligns with both nations’ commitments to sustainable development.

A key critical gap is the need for concrete implementation of agreements. Past experiences with similar partnerships have shown that ambitious goals often fall short due to bureaucratic hurdles and lack of sustained political will. The article also highlights the importance of coordinating with other developing nations to present a united front against protectionist policies.

The article implicitly points to the need for India to move beyond a reactive approach to US policies and proactively pursue its strategic autonomy. This requires strengthening partnerships with other like-minded nations and diversifying its economic and geopolitical engagements.

Value Addition

• The ‘China Plus One’ Strategy: The trade deal with the US (as highlighted in the context articles) and the diversification efforts with Brazil are part of a broader trend of companies seeking to reduce their reliance on China.
• Strategic Autonomy: The concept of strategic autonomy, increasingly emphasized by India, refers to the ability of a nation to pursue its own interests without being unduly influenced by external powers.
• Quote: “It is easy to break a single stick, but far more difficult to do so if the sticks are bundled tightly together.” – Luiz Inácio Lula da Silva. This quote encapsulates the core message of the article: the importance of collective action in a turbulent world.

Context & Linkages

This past article provides crucial context for understanding India’s current approach to the US. It highlights India’s past reluctance to confront the US directly, even when it meant incurring economic costs. The current article suggests a shift towards a more assertive stance, driven by the realization that a passive approach is no longer sustainable. The emphasis on ‘unionizing’ with Brazil reflects a growing recognition of the need for collective bargaining power.

This article demonstrates the recent positive developments in India-US trade relations. However, the current article suggests that these developments should not come at the expense of diversifying partnerships and strengthening ties with other nations like Brazil. It underscores the need for India to maintain a balanced approach and avoid over-reliance on any single country.

The Way Forward

• Strengthen Bilateral Mechanisms: Establish regular high-level dialogues and working groups to address specific areas of cooperation, such as trade, investment, and technology.
• Coordinate with BRICS & IBSA: Utilize these platforms to advocate for reforms in global governance and promote the interests of the Global South.
• Diversify Supply Chains: Actively seek to reduce dependence on single sources for critical minerals and other essential goods.
• Invest in Infrastructure: Improve infrastructure connectivity to facilitate trade and investment between India and Brazil.
• Promote Digital Cooperation: Foster collaboration in areas like fintech, cybersecurity, and data governance.