How will the BRICS energy pact pan out?

UPSC Syllabus Topic: GS Paper 2 –International Relation

Introduction

The global energy system is under stress due to trade disruptions, sanctions, and energy transition pressures. In this background, BRICS energy cooperation is gaining importance. Questions are rising on whether it will create a multipolar energy order or a new cartel, who will lead the bloc, and how India fits into this changing energy landscape.

Changing Global Energy Order and the Rise of BRICS

1. Debate on future energy leadership: The role of BRICS in shaping the global energy system is being widely discussed due to rising geopolitical competition and weakening global energy institutions.
2. Shift away from Western dominance: Members aim to reduce dependence on Western-led financial systems and institutions that influence energy trade and governance.
3. Move towards a multipolar structure: A broad assessment suggests that the energy order is becoming multipolar, with both China and Russia playing strong roles instead of a single dominant power.
4. Energy as a strategic pillar: Energy cooperation has gradually become one of the most important pillars of BRICS cooperation.
5. Large global footprint: The bloc accounts for nearly 50 percent of global energy production and consumption, giving it structural influence in global markets.

Scope and Architecture of BRICS Energy Cooperation

1. Multi-sectoral energy framework: BRICS energy cooperation covers hydrocarbons, renewable energy, critical minerals, and energy infrastructure, reflecting an integrated approach across the energy value chain.
2. Energy security with transition balance: The bloc seeks to ensure stable energy supplies while pursuing a just and inclusive transition towards a low-carbon future.
3. Long-term cooperation roadmap: The Roadmap for Energy Cooperation (2025–2030) provides strategic direction for supply security, technology exchange, and infrastructure development.
4. Expansion into nuclear energy: The Nuclear Energy Platform, created in late 2024 and expanded in 2025, promotes corporate-level cooperation in nuclear power as a clean energy option.
5. Institutional financial backing: The New Development Bank supports nuclear and clean-energy projects, strengthening the financial architecture of BRICS energy cooperation.
6. Push for local-currency trade: Members are actively promoting the use of local currencies in energy trade to reduce dollar dependence.
7. India’s presidency priorities:

• India assumed the BRICS presidency on January 1 and is leading the 11-member bloc with the theme of resilience, innovation, cooperation, and sustainability.
• India has invited BRICS nations to participate in an energy gathering scheduled later this year.

Multipolar Energy Order vs Cartelisation Debate

1. Absence of cartel-like structure: BRICS energy cooperation does not resemble a unified cartel like OPEC, as it lacks binding production controls and enforcement mechanisms.
2. Platform for coordination, not control: The grouping operates mainly as a coordination forum that enables dialogue and cooperation rather than collective market intervention.
3. Convergence of strategic interests: Members are driven by shared goals such as energy security, supply diversification, and reduced exposure to external economic and geopolitical shocks.
4. Expansion strengthens resources, not unity: The inclusion of energy-rich countries like Iran and the UAE has expanded the resource base but has not created policy uniformity.
5. Internal diversity as a structural constraint: Wide differences in energy profiles, national priorities, and political alignments limit the emergence of a single BRICS energy policy.
6. Impact on global energy governance: Greater use of non-dollar trade and alternative payment systems weakens the leverage of economic sanctions and challenges Western-led financial and energy institutions. This shift also intensifies competition with G7 countries, particularly in energy-rich regions such as the Middle East, Africa, and Central Asia.

Power Dynamics within BRICS: China–Russia Factor

1. China’s structural strength:

• China is the world’s largest energy consumer and holds strong financial capacity.
• China dominates clean-energy manufacturing and deployment, strengthening its influence in the energy transition space.

2. Russia’s supply dominance:

• Despite sanctions, Russia remains a major supplier of oil, gas, and nuclear technology.
• Russia uses energy exports strategically to maintain geopolitical relevance.

3. Asymmetry among members:

• Other BRICS countries contribute in specialised areas rather than across the full energy value chain.
• Brazil contributes through biofuels, Gulf states through capital and reserves, and Iran through hydrocarbons under sanctions.

4. De facto Sino-Russian leadership: The imbalance in capabilities points to informal China–Russia dominance instead of equal influence.

India’s Strategic Position and Policy Challenges

1. Rising energy demand: India’s fast-growing economy has made energy security a central national concern.
2. Supply diversification gains: BRICS cooperation provides access to diversified sources and discounted hydrocarbons.
3. Finance and technology access: The grouping opens alternative financing channels and supports technology cooperation.
4. Improved bargaining power: Participation strengthens India’s negotiating position in global energy markets.
5. Lower external vulnerability: Engagement helps reduce exposure to price volatility and geopolitical pressures.
6. China factor: India must manage China’s dominant influence within the bloc carefully.
7. Strategic balance: While bilateral deals offer flexibility, India must avoid over-dependence on any single partner to preserve strategic autonomy.

Conclusion

BRICS energy cooperation points towards a multipolar energy order rather than a unified cartel. China and Russia will shape the agenda, but internal diversity limits full integration. For India, the framework offers energy security and strategic autonomy. However, success depends on managing power asymmetry and strengthening domestic clean-energy capacity.

Question for practice:

Discuss how BRICS energy cooperation is shaping the emerging multipolar energy order and examine its implications for China, Russia, and India.

Source: Businessline