Singh said international institutions were failing to support development of emerging and developing economies, and that the BRICS countries were working towards a development bank, funded and managed by them. "We have directed our finance ministers to examine the proposal and report back at the next summit," Singh said.
The bank, which could serve as an alternative to international lending institutions like the World Bank, would ensure capital for infrastructure projects and trade. Two pacts for enhancing intra-BRICS trade in the national currencies of BRICS countries were also signed. The accords would enable credit facilities in local currencies for businesses and allow development banks to extend lines of credit to each other.
Besides reducing transaction costs within the bloc, the agreement will also insulate trade from the US dollar fluctuations, officials said. The pacts could help boost intra-BRICS trade from 230 billion dollars in 2011 to the 500-billion-dollar target for 2015 set by industry leaders. The countries also resolved to promote "greater interaction" among business communities and easier visa facilities for businessmen.
The initiatives were described by Medvedev as among the steps that would "transform the future of BRICS into a strong and powerful organisation." Hu said BRICS nations should deepen political trust and intensify co-ordination in international economic, financial, trade and development fields. The BRICS nations, which held their first annual summit in 2009, account for 22 per cent of global gross domestic product and 43 per cent of the world's population.
The BRICS' share in the global economy has grown rapidly in recent years accompanied with rising diplomatic influence. In an opinion piece in the Times of India daily, Rousseff wrote that the BRICS had changed "the axis of international politics."
At the summit later on Thursday Rousseff said BRICS had become the most important engine of the world economy. "Together we will be responsible for more than half of the growth predicted for 2012, 56 per cent according to the IMF (International Monetary Fund)," she said. The Delhi Declaration issued after the summit expressed concern over the current global economic situation and in particular over the eurozone crisis.
The BRICS nations said they were ready to work along with the international community to get global growth "back on track." The BRICS leaders also stressed the need for reforms in international global governance institutions including the UN Security Council to reflect contemporary realities.
They demanded more voting rights at the IMF this year, saying the "dynamic process of reform is necessary to ensure the legitimacy and effectiveness of the fund." The summit in the Indian capital was held amid Tibetan protests against Hu's visit and Beijing's "continued suppression" in Tibet. On Wednesday, a Tibetan activist died in the city after setting himself on fire two days earlier in protest at Hu's visit. Tibetan exiles also held protests near the hotel Hu was staying in as well as the Chinese embassy on Thursday but were detained by the police.