What is the News?
India has virtually hosted the BRICS Finance and the central bank meeting.
BRICS Finance and the central bank Meeting:
- It was the first meeting on the BRICS Financial Cooperation held under India’s Chair.
- The meeting was co-chaired by the Secretary, Department of economic affairs, Ministry of finance, and Deputy governor, Reserve Bank of India(RBI).
- Other participants in the meeting included BRICS finance and central bank deputies of Brazil, Russia, China and South Africa.
Issues discussed during the meeting:
- During the meeting, India has discussed issues such as:
- Global Economic Outlook and Response to COVID-19
- Social Infrastructure Financing and Use of Digital Technologies
- New Development Bank(NDB) Activities
- Fintech for SME and Financial Inclusion,
- BRICS Contingent Reserve Arrangement (CRA).
BRICS chairmanship for 2021:
- India has assumed the chairmanship for BRICS in 2021. It is the year in which BRICS is celebrating its 15th anniversary.
- Theme: BRICS@15: Intra-BRICS Cooperation
BRICS Contingent Reserve Arrangement(CRA)
- Established in: It was established in 2015 as a part of the Fortaleza Declaration at the Sixth BRICS summit.
- Aim: It aims to provide short-term liquidity support to the members through currency swaps. It will help to mitigate the Balance of Payment(BOP) crisis situations in case such a situation arises.
- Other objectives:
- It will help member countries to forestall short-term liquidity pressures,
- Moreover, it will provide mutual support and further strengthen financial stability.
- It would also contribute to strengthening the global financial safety net and complement existing international arrangements (from IMF) as an additional line of defence.