Move over SCO and BRICS! Goldman Sachs, the global investment bank that talked of “dreaming with the BRICs” two decades ago, has a new idea now — “swing states” that will shape the global balance of power. Unlike BRICS and SCO, whose salience can only dim in the Indian strategic calculus, “swing states” are beginning to loom larger in Delhi’s strategic priorities.
The concept of BRICs — Brazil, Russia, India, and China — was about Goldman Sachs drawing investor attention to the economic potential of the four nations at the turn of the millennium. But the idea acquired a political life of its own.
Like the Shanghai Cooperation Organisation that was formed in 2001, the idea of the BRICS was a simple one — to limit American power in the unipolar moment of the 1990s. The Russians, who were looking for a way to reclaim their global position after the collapse of the Soviet Union, found BRICs a useful platform to counter the West. The Russia-India-China (RIC) forum — the so-called strategic triangle — pushed by Moscow provided the scaffolding on which to mount the new organisation.
If the ambition of the BRICS was global, the focus of the SCO was regional — to keep the US and its “colour revolutions” out of the shared inner Asian periphery of Russia and China. The “Shanghai Five” was convened by Russia and China in 1996 along with three central Asian states — Kazakhstan, Kyrgyzstan, and Tajikistan — three former Soviet Republics that shared borders with China.
Formally set up in 2006, the four initial members of the BRICs forum welcomed South Africa into their ranks in 2010 to make it BRICS. Both the SCO and the BRICS are now debating the expansion of their membership as the worldwide interest in them grows. Notwithstanding the ambitious plans for their expansion, the SCO and BRICS are running out of their geopolitical steam as the context that brought them together at the turn of the millennium no longer exists.
Large membership does not necessarily make any group more effective; by that count, the Non-Aligned Movement (NAM) and the Organisation of Islamic Cooperation (OIC) should be powerful organisations. They are not today and unlikely to be in future. The story repeats itself with SCO and BRICS.
The SCO’s core objective was to counter “external threats” from the US. Central Asia’s rulers welcomed the protection Russia and China offered against the threat of “regime change” sponsored by the West. After Moscow’s invasion of Ukraine and the Russian nationalist claim that many former Soviet republics are “artificial states”, the source of ‘external threat’ looks different in Central Asia.
Nor does the region seek to trade Russian hegemony for Chinese dominance. Central Asian states, instead, are looking to diversify their international relations, including with the US, Europe, Japan, Turkey, and India.
Like in the SCO, the contradictions within the BRICS are longer hidden. For Russia, the BRICS was about political moblisation against the US. Beijing, which enjoyed a growing relationship with the West in the 2000s, had a different dream — to leverage the forum to expand its economic and commercial influence. Now engaged in a fierce competition with the West, China sees the BRICS as a platform to legitimise its own global ambitions. For India, the RIC and BRIC were useful hedges against the potential threats from the US to its core national interests in the 1990s.
The geopolitics of BRICS looks quite different today. China has grown far more powerful than its former peers in the forum. Beijing’s GDP is bigger than all the other BRICS put together. Russia has locked itself into an expensive and unwinnable conflict with the collective West even as its relative economic weight continues to decline. As it bleeds from the Ukraine war, Moscow is now more dependent than ever before on China.
Meanwhile, India’s contradictions with China have sharpened while those with the US are being smoothed over. Delhi might have wanted a “multipolar world” in the 1990s, but its first preference today is a “multipolar Asia” — to stop the region from becoming China’s backyard.
The idea of “swing states” could endure because it is less ideological. It is rooted in the structural condition of the international system — the emergence of several nations, big or small, with significant resources, capacities, or location, to influence geopolitical outcomes.
The idea had begun to gain prominence in the early 21st century as analysts focused on several “pivotal states” that could make a difference to the global distribution of power. With the sharpening of the great power conflict in the last few years, the idea of “swing states” has gained considerable traction.
Goldman Sachs is making the concept relevant to global investors who are struggling to cope with the breakdown of great power harmony and the retreat of economic globalisation. In other words, the debate on “swing states” is no longer between armchair strategists in think tanks. It is about educating the moneybags.
According to the report published by Goldman Sachs, “geopolitical swing states are critical to the world economy and balance of power, but they don’t have the capacity by themselves to drive the global agenda, at least for now”. “As long as the tensions between the US and China continue to get worse” the report says, the swing states “will have outsised abilities to navigate geopolitical competition and take advantage of and influence it”.
The report identifies four kinds of swing states. These are countries that can dominate “critical components of the world’s supply chains”; states that can “capitalise on current trends toward near-shoring, off-shoring, and friend-shoring”; nations with “disproportionate amount of capital and willingness to deploy it around the world in pursuit of strategic objectives”, and countries that can bring global leadership to critical issues. Addressing global investors, Goldman Sachs says “the most effective business leaders will be those who work relentlessly to understand how changes in the geopolitical landscape create new risks and present new business opportunities.”
The writer is a senior fellow at the Asia Society Policy Institute, Delhi and a contributing editor on international affairs for The Indian Express