The fourth annual BRICS summit, to be held in New Delhi on Thursday, will cover a wide range of topics of interest to member countries Brazil, Russia, India, China and South Africa. One of the topics for discussion will be the idea of a multilateral bank funded by developing nations for the purpose of encouraging trade and financing projects in the developing world. This proposed initiative of establishing common institutions is seen as a step toward formalising the BRICS grouping.

While the five BRICS countries may have little in common geographically, politically, socially and culturally, they do have common economic and financial goals. Collectively, they are home to close to half the world’s population, are among the world’s major economies, and hold a large percentage of global foreign exchange reserves. It has been suggested that a common bank could aid Beijing in its goal of building the renminbi into a…