Indonesia, as the newest member of the BRICS alliance, has been advised to champion inclusivity in the New Development Bank’s (NDB) lending practices. The NDB, established to reduce Western dominance in global financial systems, has yet to extend its funding to newer BRICS members. Analysts urge Indonesia to address this as a priority in its BRICS agenda.
NDB’s Current Focus on Founding Members
Since its inception, the NDB has approved $32.8 billion in loans, benefiting only the original BRICS members: Brazil, Russia, India, China, and South Africa. China and India are the largest beneficiaries, receiving $8.1 billion and $7.5 billion respectively. However, the new entrants, including Indonesia, Egypt, Ethiopia, Iran, and the UAE, have not accessed these funds.
Analyst Advocates Regulatory Changes
Muhamad Habib, a researcher at the Centre for Strategic and International Studies (CSIS), emphasized the importance of regulatory reforms. “The NDB’s financing policies still prioritize the founding members,” Habib said during a press briefing in Jakarta. He highlighted that Indonesia’s push for inclusivity could reshape the global economic structure.
Egypt’s Struggles with NDB Funding
Among the new members, Egypt has been proactive in seeking NDB funding but without success. Egyptian utility firm Suez Wind Energy S.A.E requested $100 million for a 1.1-gigawatt wind farm project. Similarly, the African Export-Import Bank sought $200 million for infrastructure development. Both proposals remain unapproved.
UAE and Bangladesh’s Experiences with NDB
The UAE joined the NDB in 2021, before its formal inclusion in BRICS, but has yet to submit any funding proposals. Bangladesh, although not a BRICS member, is part of the NDB and awaits decisions on its funding applications. This situation underscores the need for transparent and inclusive financing practices.
Indonesia’s Opportunity to Lead Reform
Experts believe Indonesia’s active role in advocating for regulatory changes could significantly impact the BRICS framework. Habib stressed that Indonesia’s agenda should focus on making NDB funds accessible to all members. This step would not only strengthen Indonesia’s presence but also ensure equitable economic development within the alliance.
Key NDB-Funded Projects
While new members face challenges, the NDB continues to finance projects in founding member states. India secured $490 million for highway expansion in Madhya Pradesh. Last year, China received $150 million to acquire LNG carriers to bolster energy imports. These projects demonstrate the NDB’s strong support for its original members.
A Call for Inclusivity
Indonesia’s inclusion in BRICS presents an opportunity to address disparities in NDB financing. By advocating for policy amendments, Indonesia can ensure that newer members benefit from the alliance’s resources. This move would reinforce BRICS’ commitment to global economic equity and inclusivity.
Indonesia’s active engagement in BRICS could redefine its role in shaping global financial policies. With strategic initiatives, it can lead efforts to bridge the gap between founding and new members, fostering a more balanced economic framework.
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