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ARTICLES
BRICS COUNTRIES' ECONOMIC AND LEGAL COOPERATION THROUGH THE PRISM OF STRATEGIC PLANNING DOCUMENTS
VENERA SHAIDULLINA, Digital Platform for Legal Initiatives "Initiator" (Moscow, Russia)
IGOR SEMENOVSKIY,
Financial University under the Government of the Russian Federation (Moscow, Russia)
https://doi.org/10.21684/2412-2343-2022-9-1-4-34
The purpose of this article is to identify the core trends in economic and legal cooperation among the BRICS countries through the prism of strategic documents and normative acts adopted to define national development benchmarks in certain economic sectors. The authors carried out an analysis of strategic and policy documents adopted by Brazil, Russia, India, China and South Africa with a view to developing certain sectors of the national economy. It is pointed out that international cooperation is now considered necessary to achieve sustainable economic growth. The relevance of the research topic is dictated by the need to determine and develop approaches to improve the legal fundamentals of economic cooperation among the BRICS countries, as well as to prepare proposals for their implementation. The analysis of national programs and development priorities of the economies of the BRICS member countries has shown that the programs of Russia and China are the most comprehensive. Brazil's development priorities, the socio-economic development policy of India and South Africa's national development plan are primarily aimed at overcoming the problems inherent in these countries. Among the main areas of interest for all of the BRICS countries are agriculture, digital economy, energy, environment, education and health, finances, labour and employment, infrastructure and transportation and trade. Cooperation among the BRICS countries is likely to develop mainly through the exchange of experiences and best practices, joint research and realization of specific economic projects supervised by executive authorities, central banks and other state
bodies. An important institution for economic interaction between the BRICS countries is the New Development Bank; other successful mechanisms of economic cooperation include the Contingent Reserve Arrangement, the Energy Research Cooperation Platform and the Partnership on New Industrial Revolution.
Keywords: BRICS; legal fundamentals; economic cooperation; program; strategy; global governance; SDGs.
Recommended citation: Venera Shaidullina & Igor Semenovskiy, BRICS Countries' Economic and Legal Cooperation Through the Prism of Strategic Planning Documents, 9(1) BRICS Law Journal 4-34 (2022).
Table of Contents
Introduction
1. Analysis of Development Priorities of the Federative Republic of Brazil
2. Analysis of Development Priorities of the Republic of India
3. Analysis of Development Priorities of the People's Republic of China
4. Analysis of Development Priorities of the Republic of South Africa
5. Analysis of Development Priorities of the Russian Federation
6. Research Results
Introduction
International and regional cooperation is now considered one way to achieve economic growth. Efficient distribution of resources, complementarity in topical areas of industrial and technological cooperation, expansion of production networks and markets, all have a positive impact on the economy of each individual association member country. However, the implementation of policies aimed at building economic cooperation and convergence in a wide range of areas requires a balanced approach and a careful assessment of projected benefits and costs for countries. Today, some experience has already been accumulated in matters of legal regulation of relations of integration processes, and its analysis can undoubtedly be useful for improving the legal fundamentals of economic cooperation among the BRICS countries.
Thus, the relevance of the research topic is dictated by the need to develop approaches to improve the legal fundamentals of economic cooperation among the BRICS countries and to prepare proposals for their implementation.
Economic cooperation within the BRICS framework is mainly conducted in areas where there is a convergence of member countries' interests. This is explained by the fact that BRICS is not an institutionalized association founded on an international agreement with legally binding rules. At the legal level, these areas can be identified through an analysis of their strategic planning documents, and at the applied level, through declarations and other documents of summits and meetings of heads of states and representatives of relevant ministries and departments.
1. Analysis of Development Priorities of the Federative Republic
of Brazil
Brazil is the largest country in Latin America with a population of 214.7 million people1 (6th place in the world) and one of the world's leading economies (8th place in the world by GDP, $2.05 trillion2). Since 2000, the country's macroeconomic stability has been improving, resulting in significant GDP growth, which peaked at $2.46 trillion in 2014. In 2015-2016, due to a number of reasons, there was an economic downturn, from which the economy is gradually emerging. Some macroeconomic stability and a favourable external environment have helped to boost consumption by stabilizing employment and raising wages. Rising commodity prices had a positive impact on government revenues. Sustained economic growth as well as attractive interest rates has resulted in foreign investment inflows. At the same time, production growth is constrained by the devaluation of the real, which is artificially kept at a low level.3
Despite some economic progress, large disparities in income and gender inequality remain major challenges: in Brazil, 8.7% of individuals were below the poverty line in the middle of twentieth century's second decade;4 half of the population accounts for 90% of incomes, while the other half earns 10%; men earn 50% more on average for their work than women, and many women do not have permanent jobs.5 The unemployment rate among young Brazilians is twice as high as the national average. Social security, pensions and the guarantee of quality education for all segments of the population are all pressing issues.
1 Brazil Population, Worldometer (Jan. 5, 2022), available at https://www.worldometers.info/world-population/brazil-population.
2 GDP (current US$) - Brazil, The World Bank (Jan. 5, 2022), available at https://data.worldbank.org/indi-cator/NY.GDP.MKTP.CD?locations=BR&view=chart.
3 Экономика Бразилии. Состояние экономики Бразилии и ее роль в мировом хозяйстве // Ereport. ru [Brazilian Economy. The State of the Brazilian Economy and its Role in the World Economy, Ereport. ru] (Jan. 5, 2022), available at http://www.ereport.ru/articles/weconomy/brazil.htm.
4 Сун И. Геополитические условия создания БРИКС // Sciences of Europe. 2018. № 29-2(29). С. 35-38 [Ifan Song, Geopolitical Conditions for BRICS, 29-2(29) Sciences of Europe 35 (2018)].
5 OECD, OECD Economic Surveys: Brazil - Overview (February 2018) (Jan. 5, 2022), available at https:// www.oecd.org/eco/surveys/Brazil-2018-0ECD-economic-survey-overview.pdf.
The main social and economic policies of Brazil have been formulated in the National Strategy for Economic and Social Development. The vision of the future for the years 2020-2031 aims to catalyze all dimensions of sustainable development, conceived as a path to prosperity. The document considers the macroeconomic scenario for the next twelve years and is organized into five sections: economic, institutional, infrastructure, environmental and social. They are also detailed in a number of policies and documents, including the four year multi-annual plans, and are presented in the United Nations study on sustainable development goals through 2030.6 Based on these and other documents, the following main priorities for Brazil can be identified:
1. Budget consolidation, the objectives of which are to restructure public expenditure and change the tax system in order to increase the predictability of macroeconomic policy, ensure macroeconomic stability and curb the real growth of public expenditure and public debt. Its main directions are limiting federal government spending, consolidating sub national debt and rationalizing social programs.
2. Promoting sustainable economic growth. One of the main directions is to create conditions to stimulate investments. To accomplish this task, the conditions for the participation of foreign companies in the implementation of economic projects are being liberalized (for example, a more flexible system of oil and gas auctions is being introduced); an Investment Partnership Program has been adopted aimed at increasing the attractiveness of the private sector in the implementation of infrastructure projects and the legislative and regulatory framework for micro entrepreneurship and the activities of individual micro entrepreneurs are being improved. In addition, conditions are being created for the functioning and performance of small and medium-sized enterprises, including simplified procedures for their registration and payment of taxes.7
3. Foreign trade facilitation. The National Export Plan was adopted, providing for:
• ensuring access to markets (negotiating market opening agreements and removing trade barriers);
• trade promotion (increasing export potential of companies);
• introduction of a new registration system (new DRAWBACK), which increases the benefit of companies from export operations;
• facilitating the tax regime by changing the Special Customs Regime of Industrial Warehouse under Automated Control of Customs Board (RECOF);
6 Secretariat of Government of the Presidency of the Republic and the Ministry of Planning, Voluntary National Review on the Sustainable Development Goals - Brazil 2017 (Jan. 5, 2022), available at https:// sustainabledevelopment.un.org/content/documents/15806Brazil_English.pdf.
7 Ревенко Н.С. Приоритеты социально-экономического развития стран БРИКС: сравнительный анализ целей и задач // Горизонты экономики. 2019. № 5. С. 79-89 [Nikolai S. Revenko, Priorities of Socio-Economic Development of the BRICS Countries: The Goals Comparative Analysis, 5 Economy's Horizons 79-89 (2019)].
• reforming contributions to the Social Integration Program (PIS) and the Social Security Financing Facilitation (COFINS) program by simplifying loan calculations, increasing recovery rates, and reducing tax balances in export chains.
In addition, in order to facilitate import, export and customs transit, a singlewindow system for foreign trade has been created (the Single Portal program -Portal Único), integrating information flows and computerized systems involved in export-import transactions.
4. Energy. Brazil is a major oil producer, with the vast majority of its oil being produced offshore. The hydropower industry is at a high level: HPPs (hydro power plants) generate approximately 65% of the country's electricity.8 Nuclear power is still not widely used: only 3% of electricity is generated by NPPs (nuclear power plants).9
The country's economic strategy provides for the availability of infrastructure and technological base for the extraction and processing of energy resources, as well as financial support for the development of the industry, domestic market and access to foreign markets.10
5. Transport engineering. In Brazil, the automotive and aviation industries are well developed. In terms of the number of cars produced, it takes 8th place in the world;11 this result was achieved, inter alia by, introducing high customs duties on car imports. A distinguishing feature of the local automobile industry is the production of cars capable of running on ethanol.
Embraer, one of the leaders in the global short-haul aviation market, has become known for its commercial, military, corporate and agricultural aircraft. It claims, along with Canadian Bombardier, to be third after Airbus and Boeing in terms of aircraft production.
6. Agriculture. Since 1990, this economic sector has developed rapidly, resulting in a two-fold increase in agricultural production over the next two decades, including a three-fold increase in livestock production.12 Today, 33% of the country's GDP is
8 Maximiliano Proaño, Brazilian energy under Bolsonaro'sgovernment: Brazil above all?, Energy Transition,
9 November 2018 (Jan. 5, 2022), available at https://energytransition.org/2018/11/brazilian-energy.
9 Ekaterina A. Degtereva et al., Influence of Innovations in the Education of the BRICS Countries on the Change in Their Positions in the Ranking of the Global Innovation Index, 1 Rostov Scientific Journal 97 (2019).
10 Гордиенко Н.Н., Тульчеев В.В., Жевора С.В. Причины возникновения ЕАЭС, БРИКС И ШОС и перспективы дальнейшего сотрудничества // Экономика сельского хозяйства России. 2019. № 1. С. 87-92 [Natalia N. Gordienko et al., Causes of EEU, BRICS and SCO and Prospect of Further Cooperation, 1 Agricultural Economics of Russia 87 (2019)].
11 Бойко С.М. Проблематика международной информационной безопасности на площадках ШОС и БРИКС // Международная жизнь. 2019. № 1. С. 1-22 [Sergei M. Boiko, Issues of International Information Security at the SCO and BRICS Sites, 1 International Life 1 (2019)].
12 Усманова К.Н. Рейтинговая система стран БРИКС и ее влияние на инвестиционную деятельность России // Международный журнал гуманитарных и естественных наук. 2019. Т. 2. № 1. С. 105109 [K.N. Usmanova, The Rating System of the BRICS Countries and its Impact on Investment Activities in Russia, 2(1) International Journal of Humanities and Natural Sciences 105 (2019)].
generated in the agro-industrial sector. Brazil is a major exporter of products such as coffee and sugar.
7. Brazil has recently focused on the digitalization of all spheres of life. The Law 12965/14, Marco Civil da Internet 2014, establishes the rights and duties of business entities when using the Internet, as well as principles such as network neutrality and personal data protection. High-speed communication networks are being developed at an accelerated pace (National Broadband Connection Plan program).13
8. Ecology. Brazil is concerned about climate change and is calling for urgent action. It is planned to increase the share of renewable energy sources in the energy consumption structure to 45% by 2030, including at least 23% in energy supply (excluding hydropower). Efforts are focused primarily on the development of hydropower, including the construction of small HPPs. Thus, during the construction of the Belo Monti dam on the Shingu River (a tributary of the Amazon), 40,000 people were displaced and 1,500 square kilometers of land were flooded, which affected climate change in the region.14
9. Social sector. The main areas of social policy are poverty reduction, quality education for all segments of Brazilian society, gender equality while expanding opportunities for women, employment promotion and pension reform.
The Brazilian authorities have focused on reducing poverty, improving the sustainability of social security and protecting low-income households. The Brazilian National Social Security Program, Bolsa Familia, was adopted in the early 2000s, providing for the following:
• families with low incomes receive cash grants to provide schooling for children aged 7 to 14,
• more than 30 subprograms on food supply (distribution of food baskets, organization of catering in schools and enterprises, monitoring of food quality and nutrition), private agriculture development (crediting and subsidizing farmers, insurance against crop failure and non-realization of products) and support for entrepreneurial activity of low-income people are being implemented,
• financial assistance is provided to the low-budget segments of the population (assistance in gasification of houses, payment of transport expenses of schoolchildren and protection of their health, assistance in employment).15
13 ХейфецБ.А. БРИКС: повестка для России на саммите - 2020 в Челябинске // Российский внешнеэкономический вестник. 2019. № 1. С. 63-74 [Boris A. Kheifets, BRICS: Agenda for Russia at the Summit - 2020 in Chelyabinsk, 1 Russian Foreign Economic Bulletin 63 (2019)].
14 Beatriz Mattos & Maureen Santos, Brazil: From Brazilian Comprehensive Growth Strategy to Sustainable Development Goals, Heinrich Boll Foundation (May 2017) (Jan. 5, 2022), available at https://www.boe-ll.de/sites/default/files/e-paper_international_politics_g20_from_brazilian_comprehensive_growth_ strategy_to_sustainable_development_goals.pdf?dimension1=ds_g20_en.
15 Бразильская национальная программа социального обеспечения Bolsa Familia («Семейный кошелек»): опыт реализации, социальные и политические последствия / Экспертный институт социальных исследований [Expert Institute for Social Research, Brazilian National Social Secu-
In October 2016, the Happy Children program was adopted with the aim of promoting the comprehensive development of children at an early age, taking into account their family and living conditions, strengthening family and social relations, providing care for foster children and assisting pregnant women. The goal is to reach 4 million children.16
Among the educational programs, PRONATEC should be highlighted, which is aimed at ensuring access to technical education and promoting employment in the context of economic, social and geographical heterogeneity. It includes in-service training of teachers (Profuncionario), organization of educational courses and distance learning centres (Rede e-Tec Brazil) and the opening and updating of regional technical schools (Brazil Professionalized). The SENAI National Industrial Training Service has also been successful in providing Brazilians with technical vocational training.17
In 2016, President M. Temer initiated social and pension reforms, which, inter alia, set the minimum retirement age for men at 65 and women at 62, and provided full retirement benefits, to which only those civil servants who entered the civil service before 2003 are currently entitled.
The current President of the country, J. Bolsonaro, agreed with that approach, stating that without it, Brazil would go bankrupt in 2022-2023.18
The modernization of Brazil's labor legislation, aimed at increasing labor market flexibility, is well under way. As a result, contracts concluded within the framework of collective agreements are legally binding and employee contributions to the social security and pension systems are increased, among other things.
2. Analysis of Development Priorities of the Republic of India
For decades, the development of the country's national economy was based on five-year plans. The last twelfth plan ended in 2017, and its target slogan was "Fast, comprehensive and sustainable growth of the country's economy," with an annual GDP growth target of 8%. However, Narendra Modi's government, which came
rity Program Bolsa Familia (Family Wallet): Implementation Experience, Social and Political Implications, Expert Institute for Social Research] (Jan. 5, 2022), available at http://eisr.ru/upload/iblock/c10/ c10cd39591a88aa6e77cea122ab9e537.pdf.
16 Secretariat of Government of the Presidency of the Republic and the Ministry of Planning, supra note 6.
17 Ревенко Н.С. Гуманизация сотрудничества в рамках БРИКС: образование, здравоохранение, культура // Горизонты экономики. 2018. № 4. С. 69-75 [Nikolai S. Revenko, The Humanization of Cooperation Within the BRICS Framework: Education, Healthcare, Culture, 4 Economy's Horizons 69 (2018)].
18 Болсонару обещал Бразилии крах без пенсионной реформы // NEWS.ru. 14 февраля 2019 г. [Bolsonaro Promised Brazil Collapse Without Pension Reform, NEWS.ru, 14 February 2019] (Jan. 5, 2022), available at https://news.ru/v-mire/bolsonaru-obeshal-bankrotstvo-brazilii-bez-pensionnoj-reformy/.
to power in 2014, decided not to make five-year plans. The Planning Commission was dissolved and the National Institution for Transforming India (NITI Aayog) was established in its place.
In November 2018, the Strategy for New India19 was released, which purposed to replace the five year plans mentioned above with an aim to accelerate economic growth to 9%-10%, make the country a $4 trillion economy by 2022-23 and achieve the United Nations Sustainable Development Goals (U.N. SDGs). The Strategy for New India has been disaggregated under four sections: Drivers, Infrastructure, Inclusion and Governance. In the section named drivers, the document lists economic growth, employment and labor reforms, technology and innovation, industry, modernizing agriculture, travel, tourism, and hospitality as key priorities. Priorities in infrastructure include energy, surface transportation, railways, civil aviation, ports, shipping and inland waterways, logistics, digital connectivity, smart cities for urban transformation, and so on.
In addition, since 2014, the Make in India program, initiated by Prime Minister N. Modi, has been implemented. Its objectives are to promote investment in the country to stimulate innovation, create employment opportunities and improve professional skills.20 One of the most important tasks set is to increase the share of the production sector from 16% to 25% by 2025.21 Many sectors of the economy that were previously only open to investment from Indian public and private sources are now open to investment from abroad. The majority of these are under the normal regime, which means that investors do not need to obtain government approval.
Based on the statements of Indian leaders and the Make in India program, the main areas of focus for the Government's development can be identified:
1. Industrial and innovative development. Viewing India as a platform for innovation, the Indian leadership has made it a strategic goal to become a highly developed country. To achieve it, new solutions are needed that go beyond the national science, technology and innovation policy launched by the Government in 2011.
In recent years, efforts have focused primarily on the development of industry, especially the telecommunications sector, and the introduction of Institutes of Chemical Technology (ICT) in all areas, including the banking sector. The result of these efforts was the rapid establishment of the world's largest financial system, the opening of more than 300 million bank accounts in record time and the formation of self-sufficient "smart" villages, which is more promising than transforming urban conglomerates into "smart" cities, as other countries have done.
19 NITI Aayog, Strategy for New India @ 75 (November 2018) (Jan. 5, 2022), available at https://www. niti.gov.in/sites/default/files/2019-01/Strategy_for_New_India_0.pdf.
20 Bolsonaro Promised Brazil Collapse Without Pension Reform, supra note 18.
21 Tina Sachdeva et al., Transforming India - A Vision Towards a New Paradigm for Socio-Economic Growth in India Through Financial Services, 6(5) Indian J. Res. 326 (2017).
The Indian economy is also focused on the development of innovation, such as the digitization of face-to-face transactions, as well as streamling the tax process and broadening the tax base, all of which should lead to more inclusive Indian economic growth.22 According to the World Economic Forum's Inclusive Development Index, which defines a country's position in the world, India was ranked 62nd in 2018 among seventy-four countries in transition.23
The main objective of the Make in India program is to stimulate foreign direct investment (FDI) and, as a result, to ensure economic growth in a population growth environment that is sustainable. India's economic growth in recent years has served as a driver of economic growth for the South Asian region, which has become the fastest growing region in the world.24 Today, India is the third largest economy in the world, and PwC experts believe it has a good chance of surpassing the United States and becoming the world's second largest market by 2050.25
As a result of the Make in India program, substantial financial resources were raised in the country between 2014 and 2016. Thus, the inflow of FDI into the automotive sector grew by 72%,26 aviation by seven times,27 computer and software production by 409%28 and energy by 25%.29 Significant financial injections have also been made into the construction, biotechnology sector, port facilities, rail transport, road construction, tourism, food industry.
However, FDI inflows to India have been lower than expected due to a lack of electricity and skilled labor, inadequate transport infrastructure, complex legislation and a large number of outdated labor laws and regulations. In addition, trade unions
World Economic Forum, The Inclusive Development Index 2018: Summary and Data Highlights (Jan. 5, 2022), available at http://www3.weforum.org/docs/WEF_Forum_IncGrwth_2018.pdf.
Andrew Wright, 8 things you need to know about India's economy, World Economic Forum, 1 October
2017 (Jan. 5, 2022), available at https://www.weforum.org/agenda/2017/10/eight-key-facts-about-indias-economy-in-2017.
By 2050, six of the world's seven largest markets will be in developing countries, including Russia, PricewaterhouseCoopers (Jan. 5, 2022), available at https://www.pwc.ru/ru/press-releases/2017/2050. html.
Department of Heavy Industries (Jan. 5, 2022), available at https://drive.google.com/file/d/0B-Tv7_upCKANU1JxQWdYMDAzNGM/view.
Department of Industrial Policy and Promotion and Ministry of Civil Aviation, Aviation Sector -Achievement Report (February 2017) (Jan. 5, 2022), available at https://drive.google.com/file/d/0B-Tv7_upCKANVVM0bDFBT1lyYjA/view.
Department of Industrial Policy and Promotion and Ministry of Electronics & Information Technology, Electronics & IT Sector - Achievements Report (November 2016) (Jan. 5, 2022), available at https:// drive.google.com/file/d/0B-Tv7_upCKANTF9YY0RZY0N0S00/view.
Department of Industrial Policy and Promotion and Ministry of Power, Power Sector - Achievements Report (December 2016) (Jan. 5, 2022), available at https://drive.google.com/file/d/0B-Tv7_upCKANV1E1dkd3QnVtVzQ/view.
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are very influential in the country, trying to impose their conditions on owners, and often resulting in labor conflicts with high financial losses.
2. Power. Over the years, India's energy policy has focused on increasing per capita energy consumption. Nearly 304 million citizens have no access to electricity, putting energy security at the forefront. India seeks to achieve double-digit growth in national income by providing clean energy access to all its citizens, which is seen as a key factor in the poverty reduction program.
India is the third largest consumer of oil, behind only the United States and China. For instance, in 2016, it grew by 8.3% to 212.7 million tons, compared to the world's average growth rate of 1.5%.30 According to India's executive authorities, the country's crude oil production in 2014-2015 was 2,817 million tons, of which 68.5% was produced by a state-owned company, Oil and Natural Gas Company (ONGC) and 31.5 by the private sector, and the volume of production on land and offshore was approximately equal. In the same year, natural gas production was 2,5319 bcm (mostly offshore, 74.0%), of which 73.7% was produced by ONGC and 26.3% by private companies.31
Thermal sources (63.2%) are mainly used for power generation in India: hard coal (54.3%), gas (7.0%), lignites (1.7%) and oil (0.2%). Hydroelectric power plants produce 12.7% of total energy, with renewable sources accounting for 22.0%.32 Electricity production grew dynamically from 2009-2015 (the largest increase occurred in 2014-2015 at 8.43%), but then the pace began to slow down. In 2018-2019, the growth rate was only 3.57%.33
In 2017, the National Energy Policy (NEP) was developed and is set to last until 2047, providing for the universal electrification of the country by 2022, a reduction of oil imports by 10% by this year compared to 2014-2015 and a 33-35% reduction of emissions into the atmosphere by 2030 compared to 2005.34 Much attention is paid here to renewable energy production technologies. As a tropical country, India is rich in them. Thus, it is the fourth largest wind power producer in the world (32848 MW in 2017), second only to China (188232 MW), the United States (89077 MW) and Germany (56132 MW).35 Solar power has great potential in India because it has
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Oil consumption grows fastest in India, The Economic Times, 20 June 2017 (Jan. 5, 2022), available at https://economictimes.indiatimes.com/markets/commodities/news/oil-consumption-grows-fast-est-in-india/articleshow/59228022.cms.
About Exploration & Production, Ministry of Petroleum and Natural Gas (Jan. 5, 2022), available at
http://petroleum.nic.in/exploration-production/about-exploration-production.
Power Sector at a Glance ALL INDIA, Ministry of Power (Jan. 5, 2022), available at https://powermin. gov.in/en/content/power-sector-glance-all-india.
NITI Aayog, Draft National Energy Policy (June 2017) (Jan. 5, 2022), available at https://www.niti.gov. in/writereaddata/files/document_publication/NEP-ID_27.06.2017.pdf.
Global Wind Energy Council, Global Wind Statistics 2017 (February 2018), at 3 (Jan. 5, 2022), available at https://gwec.net/wp-content/uploads/vip/GWEC_PRstats2017_EN-003_FINAL.pdf.
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an ideal combination of high insolation and population density. The sharp decline in prices for wind and solar technologies in 2010-2015 by approximately 60% and 52% per KWh, respectively, increased the profitability of their use.36 In addition, approximately 750 million tons of biomass, unsuitable for cattle feeding, which can replace crude oil, coal and LNG, are available in India annually.
3. Infrastructure development. In 2018, India was ranked 44th in the World Bank's Logistics Performance Index (LPI) and 53rd in infrastructure development among 160 countries.37 Since infrastructure is a key element in the development of the Indian economy, the challenge is to bring it up to world standards.
According to the Department of Industrial Policy and Development of India, the volume of FDI in the construction sector (construction and modernization of settlements and residential premises, implementation of development projects) from April 2000 to March 2019 amounted to $25.05 billion. The logistics sector is growing at an average annual rate of 10.5% and is expected to reach $215 billion by 2020.38 In order to ensure the sustainable development of the country, infrastructure projects will need to be implemented by 2022, which will cost approximately $77.73 billion.39
With the world's second-largest road network in terms of length (as of December 2018, its total length was 5,483,000 km, including 120,000 km of national highways and 155,000 km of regional highways), and a total railway length of 1,232,366 km, India is seeking to raise funds for new construction. As of November 2018, 5,759 km of roads have been constructed under the Make in India program.
4. Digital economy. Started in 2014, Digital India is going to transform the country into a "digital society and knowledge economy"40 by providing citizens with online access to public services, digital infrastructure accessible to every citizen and highspeed Internet access. Comprised of three blocks (Digital Infrastructure as the main benefit for every citizen, Management and Services on Demand, Digital Empowerment of Citizens), this program concerns such areas of work as access to high-speed Internet, digital identification of citizens, cyber security, digitalization of government services and businesses, expansion of services through mobile and online platforms, development of cashless electronic transactions, increasing digital literacy of the population, providing digital resources and services in the Indian languages, among others.41
NITI Aayog, supra note 34.
Global Ranking 2018, The World Bank (Jan. 5, 2022), available at https://lpi.worldbank.org/ international/global.
Infrastructure Sector in India, India Brand Equity Foundation (Jan. 5, 2022), available at https://www. ibef.org/industry/infrastructure-sector-india.aspx.
Indian Infrastructure: Industry Analysis, India Brand Equity Foundation (Jan. 5, 2022), available at https://www.ibef.org/industry/infrastructure-presentation.
Lilia S. Revenko & Nikolai S. Revenko, Sectoral Cooperation of the BRICS Countries: Potential and Implementation Priorities, 12(4) The World of New Economy 67 (2018).
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5. Education. India's education policy is marked by low average literacy rates: in 2015, the adult literacy rate was estimated at 72.2%,42 and the United Nations Development Program's Education Performance Index ranked India 128th in 2017, after Uganda, Cameroon, Democratic Republic of the Congo, Ghana and Cambodia.43 The quality of education remains low, despite the fact that there are about 700 universities in the country with about 20 million students.44
India's policies in the field of education are aimed at improving the quality of education and teaching, as well as increasing transparency in management. In New Delhi, it is acknowledged that modern education should incorporate new technologies, but that the traditions of Indian society must be respected.
India already has a good record in education. The most interesting aspects of them are:
• National Skill Qualifications Framework, aimed at the introduction of a pan-Indian skills and knowledge certification system.45
• The Apprentices Act, which was amended in 2014 to encourage employers to hire more apprentices. According to Act, the share of apprentices may reach 10%. As a result, their number increased from 270,000 to 310,000 in the fiscal year 2015-2016.46
• The Skill India program initiated in 2015 by the Ministry of Labor and Employment and the Ministry of Training and Enterprise Development. Its goal is to train and improve the qualifications of 500 million young citizens by 2020.47
• The Labor Market Monitoring System (LMIS), which is used to forecast demand for personnel.
India has also been very successful in reforming its vocational education system. The previous system was ineffective (in 2012, with a 25% plan, it covered only 3% of high school students).48 The new system of employment promotion, called Resource
42 India - Adult literacy rate (ages 15+) (Jan. 5, 2022), available at https://knoema.ru/atlas/Индия/topics/ Образование/Грамотность/Индекс-грамотности-взрослого-населения.
43 Ranking of countries by level of education (Jan. 5, 2022), available at https://nonews.co/directory/ lists/countries/education.
44 Краткий сборник лучших практик подготовки кадров стран БРИКС [Brief Collection of Best Practices for Training BRICS Countries] (Jan. 5, 2022), available at https://rda.worldskills.ru/storage/app/media/ Reports/2015_BRICS%20best%20practices/2015_BRICS%20best%20practices_report_RU.pdf.
45 Note: It consists of ten levels, allowing employees, based on their knowledge and skills, to obtain the required level of competencies, find work and improve their qualifications.
46 Department of Industrial Policy and Promotion and Ministry of Skill Development and Entrepreneur-ship, Skill Development Sector - Achievements Report (December 2015) (Jan. 5, 2022), available at https://drive.google.com/file/d/0B-Tv7_upCKANdGw5M09NVU9ZRnc/view.
47 Rumani S. Phukan, Skill India Programme - Objectives, Features & Advantages, India Map, 25 December 2014 (Jan. 5, 2022), available at https://www.mapsofindia.com/my-india/society/skill-india-a-new-programme-to-be-launched-in-march-2015.
48 Анализ зарубежного и отечественного опыта по осуществлению совместных проектов и программ по взаимодействию с научными организациями, работодателями, общеобразователь-
Integration for Sustainable Employment (RISE) has some key elements. It covers a significant part of the population, has a system of information on the labor market, as well as sectoral personnel councils.
If implemented education policies do not fail, India's potential in the global community can be ensured as early as the 2040s.
6. Social issues. India is a country with high social inequality: 1% of the richest citizens own 53% of the country's national wealth. For comparison, in the United States, for example, 1% of the richest people own 37.3% of the national wealth. However, 224 million people in India are poor.
A major challenge is the large population: 1.38 billion people,49 or 17.9% of the world's population, of which 29.7% are under the age of 15 and 64.9% are between the ages of 15 and 64.50 This age structure is progressive, typical of developing countries with relatively low life expectancy and high mortality rates. The number of men outnumbering women (51.6% and 48.4%, respectively)51 determines the socio-political atmosphere in society, forcing the authorities to take measures to stabilize it.
Another pressing problem is the high unemployment rate. The number of young people with professions alone exceeds 5 million people, including about 1.5 million graduates of educational institutions.
One of the main directions in the social sphere is the improvement of quality of life indicators. Special emphasis is placed on the agricultural sector, given that it employs more than 50% of the workers52 and the government provides subsidies to farmers, insuring them against seasonal weather events.
The country's budget provides for the payment of social subsidies under the implementation of a program to provide housing for all segments of the population
50
ными организациями, организациями высшего образования, социально ориентированными некоммерческими организациями, международными образовательными центрами для подготовки и переподготовки квалифицированных рабочих и специалистов среднего звена (молодежи, взрослого населения, инвалидов и лиц с ограниченными возможностями здоровья): отчет (2017) [Analysis of Foreign and Domestic Experience in Implementing Joint Projects and Programs for Interaction with Scientific Organizations, Employers, General Education Organizations, Higher Education Organizations, Socially Oriented Non-Profit Organizations, International Educational Centres for the Training and Retraining of Skilled Workers and Mid-Level Professionals (Youth, Adults, Disabled People and People With Disabilities): Report (2017)] (Jan. 5, 2022), available at https://glo-baledu.ru/files/Информация.pdf.
Счетчик населения Индии // CountryMeters [India Population Counter, CountryMeters] (Jan. 5, 2022), available at https://countrymeters.info/ru/India.
Распределение населения по возрастным группам // CountryMeters [Age Distribution of Population, CountryMeters] (Jan. 5, 2022), available at https://countrymeters.info/ru/Indiatpopulation_density.
Budget 2018: Leaning in on the social sector - Reforms and infrastructure initiatives also augur well for the industry and services, The Financial Express, 2 February 2018 (Jan. 5, 2022), available at https://www.financialexpress.com/budget/budget-2018-leaning-in-on-the-social-sector-reforms-and-infrastructure-initiatives-also-augur-well-for-the-industry-and-services/1045967.
49
51
by 2022, and the National Health Program is expected to cover ten categories of families based upon income.
The strategic goal of the country is to eliminate gender and caste inequality.
7. Corruption. According to the Global Corruption Barometer, India's corruption index in 2017 was 69%, which is higher than that of other BRICS countries (Russia 34%, China 26%, Brazil 11% and South Africa 7%).53 As noted by experts, the main reasons for the current state of affairs are the low level of spiritual and moral values in the education system, low civil service salaries and inadequate punishment for the crimes committed.54
To combat corruption, a right to information law has been adopted, providing for the provision of all kinds of information to citizens, such as information on the use of tax collection funds. In addition, a Central Vigilance Commission (CVC) has been established to which information about corruption must be reported. These measures, however, are not sufficient, so the idea of creating special courts for the rapid sentencing of corruption cases has been put forward.
3. Analysis of Development Priorities of the People's Republic
of China
China has the most developed economy among the BRICS member states. In terms of share in gross world product, calculated at purchasing power parity, China surpassed the United States back in 2014, and by the end of 2017, the gap was already more than two percentage points (17.71% for China and 15.50% for the United States).55
The development of the national economy of China is based on five-year plans, as well as strategic long-term plans up to 2050. For a long time, the drivers of China's economic development have been heavy industry, services, retail trade and the promotion of Chinese interests abroad. In March 2016, the 13th Five-Year Plan was approved, aimed at achieving a "new normal" of economic growth and restructuring the economy to address the economic and technological imbalances inherent in China. The Plan implies significant changes that open up new opportunities and, at the same time, new rules for domestic and foreign investors.
The Plan is based on the following five principles:
• Innovation. It should become the main driver of economic development, change the economic structure of the country and transition to a better growth
53 Global Corruption Barometer: Citizens' Voices from Around the World, Transparency International, 14 November 2017 (Jan. 5, 2022), available at https://www.transparency.org/news/feature/global_ corruption_barometer_citizens_voices_from_around_the_world.
54 Corruption in India, Civil Service India (Jan. 5, 2022), available at https://civilserviceindia.com/sub-ject/Essay/corruption-in-india1.html.
55 Natalia Khmelevskaya, Russia's Trade Policy Priorities in the Orbit of BRICS Economic Cooperation, 2(10) Econ. Pol'y 93 (2015).
model to replace the mass production model that served as the basis for China's economic boom.
• Coordination. Tasks for coordinating the actions of state agencies in implementing the program of growth and the maximal use of the possibilities of the domestic and world markets are set.
• Green growth. Measures have been taken to address the environmental degradation resulting from China's rapid development, environmental protection and environmentally friendly economic growth.
• Opening. Unlike in previous years, when economic policy was aimed at the development of individual sectors of the economy and free economic zones, attention is now paid to the balanced development of the economy as a whole, as well as bringing rural areas up to the level of cities.
• Inclusive development. It involves raising the standard of living of the general population to ensure China's prosperity and improving the quality of social services provided.
Improving the quality of goods and services and their competitiveness in the world market and positioning the country as a leading generator of innovation are set as medium-term objectives for growth. There is a need to shift from production to consumption, to reform the financial system, to adjust the regional development policy, to change the demographic policy and to ensure that sustainable foundations for relations in society are formed.
While the Chinese authorities aim at integrated development, it is possible to identify areas that are given special attention:
1. Transportation. China is rapidly developing its transportation infrastructure, which includes high-speed railways (HSM), highways and ships.
Initiated at the beginning of the twenty-first century, the Program of creating 25-30 thousand km of HSM by 2020 was implemented in a very short period of time. Its implementation was facilitated by the measures taken by the Government to stimulate economic growth and increase employment during the economic crisis. As a result, 19,000 km of HSM were built in ten years, and the Chinese network became the largest in the world.56 At the end of 2018, out of a total length of 131,000 kilometers of railways, the HSM length was 29,000 kilometers. Starting with Alstom (France), Bombardier (Canada) and Kawasaki (Japan), the Chinese were able to raise their technological level and successfully compete in foreign markets. Nowadays, 850 Fusin trains are capable of speeds of up to 350 km per hour and carry passengers via HSM.
China has the world's largest road network (4.77 million km in 2017), including over 140,000 km of national highways at the end of 2018. According to Chinese Minister of Transport Li Xiaopeng, it increased by 86,000 km in 2018, including 6,000
56 Зуенко И. Дорогой длинною: Как в Китае построили высокоскоростное чудо света // Lenta.ru. 2 марта 2016 г. [Ivan Zuenko, The Long Road: How China Built a High-Speed Miracle, Lenta.ru, 2 March 2016] (Jan. 5, 2022), available at https://lenta.ru/articles/2016/03/02/railways.
km of highways. Of these, 20,000 km are of national and provincial importance. The 3,425 km Trans-Chinese Motorway, which connects the port of Lianyungang on the Pacific coast of China to the Khorgos checkpoint on the border with Kazakhstan, is part of the international transport corridor "Western Europe-Western China."57
In China, measures are taken to support the national shipbuilding industry in order to encourage the construction of heavy ships: subsidies and soft loans are provided, shipyards are allowed to issue shares to obtain liquid funds, and a Shipbuilding Industry Support Fund was established in 2017. According to the plans, 60-65 vessels for liquefied natural gas transportation are to be built in China during the 13th Five-Year Plan. In addition, four supertankers and ten dry cargoes are under construction by the order of a leading sea cargo carrier, COSCO. In 2016, it was decided to build, with the assistance of Finland, a Chinese icebreaker capable of breaking ice up to 1.5 meters thick.58
The growth of ocean transport required the construction of new ports and the reconstruction of existing ones. In early 2017, there were 2,317 berths in China, capable of accommodating vessels with deadweight of over ten thousand tons.59
2. Power engineering. Providing the industry with oil products, gas and electricity, improving power efficiency and power saving and using new sources and technologies for power storage are among the priorities of the Chinese leadership. China National Petroleum Corporation (CNPC), China Petroleum & Chemical Corporation and China National Offshore Oil have been successfully operating in the domestic and foreign markets for many years, including CNPC's participation in the Yamal LNG project for natural gas production and processing.
Electricity is generated mainly at thermal power plants: in 2017, 64.7% was produced at TPPs where coal was used as fuel, 18.6% at HPPs, 4.7% at wind power plants and 3.9% at NPPs.60 As a result of this imbalance, cities experience a large amount of airborne pollutants, acid rain and smog in cities.61 In order to eliminate it, China is developing nuclear power: in addition to the 44 nuclear reactors currently in operation, thirteen more are under construction.62 Great attention is paid to the use of alternative power sources.
Project "Western Europe-Western China" and "Aktau-Beineu" (Jan. 5, 2022), available at https://europe-china.kz/links.
Морской транспорт КНР // Морские вести России [Sea Transport China, Maritime News of Russia] (Jan. 5, 2022), available at http://www.morvesti.ru/analitics/detail.php?ID=71138.
Note: Deadweight is the difference between full and empty displacement.
2017 electricity & other energy statistics, China Energy Portal, 14 June 2018 (Jan. 5, 2022), available at https://chinaenergyportal.org/en/2017-electricity-other-energy-statistics-update-of-june-2018.
Сидорович В. Угольная энергетика в Китае: прошлое, настоящее и будущее // RenEn.ru. 5 июля 2017 г. [Vladimir Sidorovich, Coal Energy in China: Past, Present and Future, RenEn.ru, 5 July 2017] (Jan. 5, 2022), available at http://renen.ru/coal-energy-in-china-past-present-and-future.
IAEA statistics: China, Power Reactor Information System (Jan. 5, 2022), available at https://pris.iaea. org/pris/CountryStatistics/CountryDetails.aspx?current=CN.
57
58
59
60
61
In 2016, the 13th Five-Year Renewable Power Development Plan for 2016-2020 was adopted. It is assumed that by 2020, the share of gas in electricity production will be 10%, that by 2030, instead of coal, the main power sources in China will be non-fossil power sources and gas, and that by 2045, they will produce up to half of the electricity.63
3. Digital economy. China has the largest number of Internet users in the world (829 million as of 30 June 2019), compared to 22.5 million in 2000. This is 1.48 times higher than in India, 2.83 times higher than in the United States and 7.57 times higher than in Russia, which occupy the 2nd, 3rd and 8th places on the list, respectively.64 The Chinese company Alibaba, with its 552 million customers, is one of the world's leaders in electronic commerce. The number of parcels sent out daily is 12 million, which is four times higher than that of Amazon (3 million).65 In 2015, a record was set for the number of transactions in one day - $ 14.3 billion.66
Internet banking was rapidly developed: the national payment system, UnionPay and platforms Alipay (1 billion users) and Tenpay were created. The latter two provide 92.65% of mobile payments, of which Alipay's share was 53.78% in Q4 2018 and Tenpay's share was 38.87%.67
In 2015, a 10-year Internet Plus plan was launched, aimed at the digitalization of the national economy with an emphasis on power, agriculture, finance, public services, logistics, e-commerce, transport, environment and other areas.68 It is expected that the implementation of the plan will allow "uniting mobile Internet, cloud computing, big data and Internet of Things with modern production, will promote development of electronic commerce, industrial networks and Internet banking, will help Internet companies to improve their international presence."69
63 Неископаемые источники энергии обеспечат 30% энергопотребления КНР к 2050-му // ЭКД. 17 августа 2017 г. [Non-Fossil Energy Sources Will Provide 30% of China's Energy Consumption by 2050, EKD, 17 August 2017] (Jan. 5, 2022), available at https://ekd.me/2017/08/neiskopaemye-istochniki-energii-obespechat-30-energopotrebleniya-knr-k-2050-mu.
64 Top 20 Countries with the Highest Number of Internet Users, Internet World Stats, 30 June 2019 (Jan. 5, 2022), available at https://www.internetworldstats.com/top20.htm.
65 Michael-Jon Lazar, Step Aside, Amazon: Alibaba Statistics Prove It's the Emperor of Ecommerce, Ready-Cloud Suite, 16 October 2018 (Jan. 5, 2022), available at https://www.readycloud.com/info/step-aside-amazon-alibaba-statistics-prove-its-the-emperor-of-ecommerce.
66 Gillian Wong et al., Inside Alibaba, the Sharp-Elbowed World of Chinese E-Commerce, Wall Street Journal, 2 March 2015 (Jan. 5, 2022), available at http://www.wsj.com/articles/inside-alibaba-the-sharp-elbowed-world-of-chinese-e-commerce-1425332447.
67 China 3rd-party payment overview for Q4, China Internet Watch, 2 April 2019 (Jan. 5, 2022), available at https://www.chinainternetwatch.com/28962/3rd-party-payment-q4-2018.
68 Guidance on Actively Promoting Internet Plus Action Plan by the State Council, Beidou, 21 July 2016 (Jan. 5, 2022), available at http://en.chinabeidou.gov.cn/c/83.html.
69 China unveils Internet Plus action plan to fuel growth, State Council of the People's Republic of China, 4 July 2015 (Jan. 5, 2022), available at http://english.gov.cn/policies/latest_releases/2015/07/04/ content_281475140165588.htm.
If it goes as per the intention of the developers, it should contribute to the creation of a new economic model and become an important engine of economic and social development and innovation.
The main objectives of work under the Internet Plus action plan are: modernization of the Internet structure (construction and modernization of high-speed landline and mobile communication lines: it is planned to increase the average speed of the Internet in cities to 50 Mbit/sec and in rural areas to 12 Mbit/sec by 202070); removal of obstacles to the introduction of information and communication technologies; development of trade and services using the Internet; development of hardware and applications for cloud computing, big data and Internet of Things; training of specialists and increasing digital literacy of the population.71
4. Agriculture. This economic sector, the leading industry of which is crop production, serves as the basis for the textile and food industries. Efforts are being aimed at modernizing production, improving food security and developing new technologies, including biotechnology, to increase yields and productivity. To this end, producers are granted tax breaks and subsidies for purchasing agricultural machinery, granting loans is simplified and state minimum purchase prices for cereals are set.72 The role of authorities in the development of the industry, the use of the latest technologies in agricultural production, the establishment of fixed prices for agricultural products, the increase in financing of agricultural production and the increase in productivity through the use of modern tillage methods have all been proclaimed as top priorities. Other priority tasks include increasing agricultural production and ensuring import substitution in connection following the imposition of an embargo on its import into the PRC by some states.73
Digital technologies are being introduced in agriculture at a rapid pace: programs for finding information on the phenotypes of plants and animals purchased, information collection and processing systems, cloud computing, big data processing, sensors, decision-making models, systems for early warning of plant diseases and
70 China Academy of Information & Communication Technology, Broadband China Strategy and its Implementation (Jan. 5, 2022), available at http://www.unescap.org/sites/default/files/Broadband%20 China%20Strategy.pdf.
71 Guiding Opinions on Actively Promoting the "Internet Plus" Action Plan, United States Information Technology Office (Jan. 5, 2022), available at http://www.usito.org/news/state-council-provides-guidance-internet-plus-action-plan.
72 Хозяйство КНР // Научный словарь-справочник [PRC Economy, Scientific Dictionary] (Jan. 5, 2022), available at https://spravochnick.ru/geografiya/kitayskaya_narodnaya_respublika_geograficheskoe_ polozhenie_knr/hozyaystvo_knr.
73 Мищенко И.В., Боровиков А.В. Аграрная политика Китая и возможности ее применения в России // Экономика. Профессия. Бизнес. 2018. Т. 1. № 1. С. 38-42 [Inna V. Mishchenko & Artem V. Boro-vikov, The Agrarian Policy of China and the Possibility of Its Application in Russia, 1(1) Economy, Profession, Business 38 (2018)].
logistics chain management, robotics for quality control and tracking of production movement and so on.74
5. Biotechnology. There are nearly 900 enterprises and 40 bioparks in China specializing in biotechnology. The development of this industry was stimulated by tax and financial incentives, as well as financing through the National High Technology Research and Development Program and the National Basic Research Program. The basis of this branch of the national economy is biopharmaceuticals (580 companies, whose products account for approximately 7% of the world market for medicinal biopreparations).
China also ranks second in the world after the United States in terms of investment in biotechnology for agriculture. A highly advanced research base in this area has been established.
Four Chinese research organizations are among the world's top ten: "Institute of Crop Science" (germplasm harvesting and storage research, molecular improvement, wheat quality assessment, high-yield resistant varieties of rice and soybeans75), Jiangnan University (research in food technology, biological and synthetic colloids), National Research Center for Agricultural and Rural Development of Zhejiang University and the Beijing Genomics Institute (molecular genetics to increase livestock productivity and plant productivity).
6. Education. Raising the general education level of the population and training qualified personnel is another of the strategic priorities of the Chinese leadership. The main documents that determine the policy in this area are the Law on Vocational Education, adopted in 1996, and the National Plan for the Medium and Long-Term Reform of Education and Development for 2010-2020. The last document sets goals to reach the level of 40% of people who have completed higher education, 90% for full secondary and 95% for incomplete secondary (9 years).76
China has a very effective system for training specialists with higher education: according to QS, six Chinese and four Hong Kong universities are among the 200 best in the world.77 However, due to the limited number of available seats, only a small percentage of school graduates study in universities. Nevertheless, the quality of
74 Martina Gerst et al., China's 'Internet Plus' Strategy: Context and Market Opportunities for European Small Businesses, EU SME Centre, 12 June 2016 (Jan. 5, 2022), available at http://www.eusmecentre.org.cn/ article/china%E2%80%99s-%E2%80%98internet-plus%E2%80%99-strategy-context-and-market-opportunities-european-small-businesses.
75 About ICS, Brief Introduction, Institute of Crop Science of CAAS (Jan. 5, 2022), available at http://ics. caas.cn/en/aboutics/briefintroduction/index.htm.
76 National Plan for Medium- and Long-Term Education Reform and Development (2010-2020) (July 2010) (Jan. 5, 2022), available at https://planipolis.iiep.unesco.org/sites/default/files/ressources/chi-na_national_long_term_educational_reform_development_2010-2020_eng.pdf.
77 QS World University Rankings, Top Universities (Jan. 5, 2022), available at https://www.topuniversi-ties.com/university-rankings/world-university-rankings/2019.
secondary special education remains lower than in other countries. Many schools, especially in autonomous regions, lack financial resources.
Of the positive developments in China, one could note the experience of implementing continuing education programs for staff, the development of standards for university teachers, the widely used practice of internships at enterprises and state institutions, the involvement of practitioners in the educational process and financial assistance programs for low-income families.
7. Health. China has made huge strides in recent years. If in the 50s of the twentieth century, life expectancy was 35 years, then in 2003 it was 71 years78 and in 2019, it grew to 75 years for men and 78 for women.79 This result was achieved as a result of an increase in health expenditures (according to World Bank statistics, in 2016 they amounted to 4.98% of the country's GDP80) and the resulting factors. The China Health 2030 project has set goals to promote healthy lifestyles and quality of service. It is planned to provide primary health care to 100% of the population.81
In China, besides classical medicine, traditional medicine based on other teachings and practices has found widespread application. Considering it a national treasure and scientific discipline, China promotes traditional medicine abroad and even initiated a discussion on this subject between the state representatives during its BRICS presidency in 2017.
8. Demographics. Recent problems include an aging of the population, a declining share of people of working-age, a sex-ratio imbalance (51.9% of the male and 48.1% of the female population82) and rising wages. As a result, the pension burden on the state budget increased and the incentive to expand businesses in China decreased.
This forced the authorities to review the "One Family, One Child" family planning policy, which had been in place for over 35 years, and to make the transition to the new "One Family, Two Children" demographic policy, which went into effect in January 2016. At the same time, according to experts, China was late in making this decision, and we should expect a drop in the total fertility rate due to a decrease in the number of reproductive-aged women.83
78 Самойлова А.В. Здравоохранение в Китае: от нищеты к новациям // Концепт. 2017. Т. 37. С. 129132 [Anastasia V. Samoilova, Health in China: From Poverty to Innovation, 37 Concept 129 (2017)].
79 China - Statistics, World Health Organization (Jan. 5, 2022), available at https://www.who.int/countries/ chn/ru.
80 Current health expenditure (% of GDP), The World Bank (Jan. 5, 2022), available at https://data.world-bank.org/indicator/SH.XPD.CHEX.GD.ZS.
81 Samoilova 2017.
82 Счетчик населения Китая // CountryMeters [China Population Counter, CountryMeters] (Jan. 5, 2022), available at https://countrymeters.info/ru/China.
83 Iulia A. Kupriianova & Anna I. Ianishevskaia, New Population Policy in China: "One Family - Two Children," 4(2) Demographic Review 53 (2017).
In addition to the above-mentioned fields, China's priorities also include the development of different areas such as aerospace engineering, machine tools, new materials and so on.
4. Analysis of Development Priorities of the Republic of South Africa
According to a report from the Executive Planning Commission that was published in June 2011, the main challenges to South Africa's socio-economic development are:
• not enough working people;
• poor quality of school education for black residents;
• inappropriate distribution of infrastructure, its inadequacy and poor maintenance;
• space allocation that inhibits inclusive development;
• unsustainable resource intensity of the economy;
• the inability of the public health system to meet demand and maintain quality;
• inadequate and poor quality public services;
• high corruption levels;
• society separation.84
After analyzing the situation in South Africa, OECD experts concluded that a key factor in high income inequality is low employment, especially among black South Africans. Job creation is constrained by regulatory restrictions on the entry of new suppliers capable of offering better and cheaper services, as well as collectively agreed-upon wages increased on a legislative basis. The employment problem is complicated by the fact that far too many people with low qualifications live in areas where employment opportunities are limited. Due to the lack of a centralized infrastructure for active labor market policy, the implementation of existing programs is fragmented.85
Small and medium-sized businesses, the development of which is key to employment growth, suffer from a high level of regulation. The state-owned economic sectors, primarily electricity and transport, lack capacity and material resources. They were also characterized by cross-subsidization, insufficient regulatory control and limited access to infrastructure by independent service providers. Although the government invests significant amounts in these sectors, there is a shortage of electricity, which affects the pace of economic development. There are far too many public companies in this country whose operations are ineffective.
84 National Planning Commission, Our Future - Make It Work: National Development Plan 2030, Executive Summary (2012) (Jan. 5, 2022), available at https://www.gov.za/sites/default/files/Executive%20 Summary-NDP%202030%20-%20Our%20future%20-%20make%20it%20work.pdf.
85 OECD, OECD Economic Survey: South Africa (July 2015), at 15 (Jan. 5, 2022), available at https://www. oecd.org/economy/surveys/South-Africa-OECD-economic-survey-overview.pdf.
These and other tasks are expected to be solved in the course of the implementation of the National Development Plan until 2030 (NDP),86 which was adopted in 2012 and is divided into three phases. Its main objective is to eliminate poverty and reduce inequality by 2030, "by drawing on the energy of its people, developing an inclusive economy, building capacity, and increasing the ability of the government and leaders to work together to solve complex problems."87
The critical condition for achieving the set objectives, as stressed in the document, is to improve the quality of public services. To do so, provinces must focus on identifying and overcoming obstacles, as well as strengthening the role of local authorities in effectively fulfilling their roles.
The Plan has formulated three main development priorities:
• increasing employment through faster economic growth;
• improving the quality of education, skills development and innovation;
• building the State's capacity to play a developmental and transformative role.
It is assumed that sustainable employment growth requires accelerated economic
development as well as addressing such issues as poor educational quality and spatial patterns of settlement. The implementation of these tasks is of great importance for increasing production and exports, as well as for investment inflow and the competitiveness of products and services.
According to the Plan, by 2030 the number of employed people in the country should increase by 11 million compared to 2010 (from 13 million to 24 million people) and per capita income from R 50,000 to 120,000. To achieve these results, South Africa's GDP growth rate should be 5% on average. The share of fixed capital by 2030 should be approximately 30% and investments in the public sector should be 10% of GDP.88
To achieve the set goals, it is necessary:
• to increase exports, which should be done by developing such areas as mining, construction, agriculture, food processing, higher education, tourism and business services;
• to implement infrastructure projects with an emphasis on construction and reconstruction of commercial ports, energy, telecommunications and water facilities;
• to reduce the cost to companies, especially small and medium-sized enterprises, of meeting regulatory requirements;
• to support small businesses by improving coordination among various institutions, including those that provide funding, and the construction of public and private incubators;
• to promote public and private procurement to develop national industry and create jobs;
• to attract investments, especially private ones.
86
87
National Planning Commission, supra note 84.
In addition, the social cohesion of the population needs to be strengthened. If the elimination of racial discrimination in property ownership and control of the economy are not accompanied by a reduction in poverty and inequality, the results will be lower than expected. The racial and gender composition of the population must be taken into account when appointing people to various positions.
Accelerating development also requires active support from all segments of the population, putting the public interest above short-term, narrowly focused objectives, and radically improving government performance. The plan therefore focuses on such issues as political freedoms and human rights; social opportunities provided by education, health, public transport and other public services; social security and safety nets; an open society, access to information and a culture of trust; economic opportunities, work, consumption, exchange, investment and production.89
Other tasks set out in the Plan are as follows:
1. Eradication of destitution and poverty. Reduction in the number of households with monthly income below R419 per person from 39% to zero and a reduction in the Gini index of income distribution inequality from 0.69 to 0.60.90 To achieve them, it is envisaged:
• to implement active labor market policies and incentives to increase employment, especially among young people and in sectors with predominantly low-skilled labor;
• to involve up to 2 million people in state employment programs by 2020;
• to develop first aid services and expand health programs at the regional level;
• to expand social security services and public employment schemes to support areas with low income and high crime rates;
• to implement a nutrition programs for pregnant women and young children, expand development services for children under five years of age, improve the quality of school education and vocational training in colleges;
• to promote housing construction and more compact urban development;
• to finance public transport development.
2. Accounting for the demographic situation in the country. Today, the share of the South African population that is of working age (15-64 years old) is 65.8%, and up to the age of 15 years, it is 28.5%.91 This age structure is usually characteristic of countries with rising incomes, faster productivity, higher savings and higher living standards. At the same time, this may lead to destabilization, employment problems, increased violence and crime and alcoholism.
89 National Planning Commission, supra note 84.
90 Id.
91 Счетчик населения Южно-Африканской Республики// CountryMeters [Republic of South Africa Population Counter, CountryMeters] (Jan. 5, 2022), available at https://countrymeters.info/ru/ South_Africa#population_2019.
Added to this is the problem of declining fertility rates (today the population of South Africa is growing by 1% per year, and is projected to grow by 0.5% per year by 2030). The proportion of the country's rural population is declining: in 2012, 60% of South Africans lived in urban areas, a figure that will rise to 70% by 2030.92 The population of Cape Town and the Etekwini Urban District, which has its administrative centre in Durban, is growing at the fastest rate, creating serious planning and supply challenges in many parts of its administration.
In this regard, the objectives are to achieve a 50% literacy rate, improve the school system, provide children and young people with a good education, enable them to acquire professional skills and assist school leavers in finding jobs. In addition, there is a need to improve nutrition and health systems as well as education standards, to increase access to complementary and higher education and to increase labor mobility.
3. Environmental protection. The energy sector of South Africa predominantly uses coal: 70% as a primary energy source and 90% for electricity generation. Mining companies use energy-intensive ore beneficiation processes (depending on how GDP is measured - in nominal terms or at purchasing power parity, energy intensity in South Africa is one and a half to four times higher than the OECD average). As a result, a large amount of carbon dioxide is emitted into the atmosphere, negatively affecting the climate.93 In order to improve the situation, it is planned to use more gas and technologies that reduce emissions from coal as energy sources. The goal has been set to develop the renewable energy sector in accordance with the 2010 Integrated Resource Plan.
4. Economy digitalization. South African leadership is aware that information and communications technology (ICT) is now an important factor in economic activity, creating opportunities for production, productivity and job creation. Although the country now has 32.6 million internet users (56.2% of the population), which is more than the African average (39.8%) and nearly as many as the world average (57.3%),94 South Africa has lost its position as a continental leader in Internet and broadband connectivity. Prices for ICT services and equipment remain a serious obstacle.
The Plan provides for the development of an ICT strategy and action plan, the key elements of which should be:
• implementation of the strategy by all government agencies and economic sectors,
• stimulating growth and innovation in the sector by attracting public and private investment, especially in upgrading and expanding broadband networks, application development and content,
92 National Planning Commission, supra note 84.
Id. Inte
worldstats.com/statsl.htm.
94 Internet Penetration in Africa, Internet World Stats (Jan. 5, 2022), available at https://www.internet-
93
• encouraging the sharing of mobile infrastructure, given the limited frequency spectrum allocated to it and the individual elements of the fibre optic network,
• public-private partnership development,
• increasing the digital literacy of the population by introducing benefits and incentives for the development of applications for use in health and education.
5. Agriculture. The development of this sector is viewed from the angle of employment growth. It is expected that agricultural production could be established in South Africa by 2030, creating 1 million new jobs. This requires the expansion of irrigated agriculture: through more efficient use of existing water resources and the development of new water supply schemes, the area of irrigated land on which almost the entire crop is grown can be increased from 1.5 to 2 million hectares.95 Within the agricultural sector, the farm industries engaged in the cultivation of olives, citrus fruits, grapes, nectarines, cotton, apples, cane sugar, bananas and vegetables receive notice for their high potential and job creation.
5. Analysis of Development Priorities of the Russian Federation
The main document defining the development of Russia's national economy and social sector is Presidential Decree No. 204 of 7 May 2018, "On National Goals and Strategic Objectives for the Development of the Russian Federation" until 2024.96 In order to ensure its implementation, the Government of the Russian Federation approved in 2018 the Main Activities for the period up to 2024.97 The Ministry of Economic Development of the Russian Federation issued a report that forecasts the socioeconomic development of the Russian Federation for the period up to 2024.98
The strategic development plans were adjusted as they were in the other BRICS countries, taking into account the crisis caused by COVID-19. The five main areas of future development were stated in the Presidential Decree No. 474 of 21 July 2020,
95 National Planning Commission, supra note 84.
96 Указ Президента Российской Федерации от 7 мая 2018 г. № 204 «О национальных целях и стратегических задачах развития Российской Федерации на период до 2024 года» // Собрание законодательства РФ. 2018. № 20. Ст. 2817 [Decree of the President of the Russian Federation No. 204 of 7 May 2018. On National Goals and Strategic Objectives of the Development of the Russian Federation for the Period Until 2024, Legislation Bulletin of the Russian Federation, 2018, No. 20, Art. 2817].
97 Основные направления деятельности Правительства Российской Федерации на период до 2024 года // Правительство России [The Main Activities of the Government of the Russian Federation for the Period up to 2024, Government of the Russian Federation] (Jan. 5, 2022), available at http://static.government.ru/media/files/ne0vGNJUk9SQjlGNNsXlX2d2CpCho9qS.pdf.
98 Прогноз социально-экономического развития Российской Федерации на период до 2024 года // Законы, кодексы и нормативно-правовые акты Российской Федерации [Forecast of the SocioEconomic Development of the Russian Federation for the Period Until 2024, Laws, Codes and Regulations of the Russian Federation] (Jan. 5, 2022), available at https://legalacts.ru/doc/prognoz-sotsialno-ekonomicheskogo-razvitija-rossiiskoi-federatsii-na-period-do-2024/.
titled "On National Goals and Strategic Objectives for the Development of the Russian Federation" until 2030: preservation of the population; health and well-being of people; opportunities for self-realization and development of talents; a comfortable and safe living environment; decent, efficient work and successful entrepreneurship and digital transformation.
These documents indicate the following as national development goals:
1. Ensuring sustainable natural growth of the population of the Russian Federation and increasing life expectancy. Implementing the Concept of Demographic Policy of the Russian Federation for the period up to 202599 resulted in a 15% reduction in total mortality, a 34.1% reduction in infant mortality and a 2.4 times reduction in maternal mortality in 2017 compared to 2008, as well as an increase in life expectancy from 67.6 years in 2007 to 72.7 years in 2017. At the same time, due to the decline in the number of women of reproductive age, there has been a downward trend in fertility.
The objective is to increase fertility and life expectancy to 78 years and to do so by 2030. The main tool for achieving this goal will be the implementation of a number of government programs and national projects.100 In particular, in order to increase the birth rate, it is planned to use the mechanism of financial support of families, to create conditions for parents with young children to work, to stimulate the birth rate in regions with low birth rates, to create opportunities for vocational training and retraining of parents during holidays to care for children and to increase access to housing for families with children. It is expected that these measures will result in the growth of the labor force from 75.8 million people in 2018 to 76.3 million people in 2024.101
2. Ensuring sustainable growth in real incomes of citizens, as well as a level of pension provision above the inflation rate, thereby halving the poverty rate. Since 2000, wage growth has been steadily upward for the past 13 years (except for the crisis year of 2009). As a result, the real incomes of citizens increased and the poverty rate decreased. Due to economic difficulties after the introduction of sanctions against Russia by Western countries, real wages fell by 9% in 2014-2016 and the poverty rate rose to 13.3% in 2015. After the economy recovered from the crisis, wage growth resumed.
99 Указ Президента Российской Федерации от 9 октября 2007 г. № 1351 «Об утверждении Концепции демографической политики Российской Федерации на период до 2025 года» // Собрание законодательства РФ. 2007. № 42. Ст. 5009 [Decree of the President of the Russian Federation No. 1351 of 9 October 2007. On Approval of the Concept of Demographic Policy of the Russian Federation for the Period Until 2025, Legislation Bulletin of the Russian Federation, 2007, No. 42, Art. 5009]
100 Note: Programs Development of Health Care, Social Support of Citizens and national projects Demography, Healthcare.
101 Forecast of the Socio-Economic Development of the Russian Federation, supra note 98.
Pensions are regularly indexed: in 2016, the average pension amounted to 12,081 rubles, in 2017 - 12,426 rubles, in 2018 - 13,360 rubles, in 2019 - 14,102 rubles.102 It is assumed that from 2019, the insurance pension for non-working pensioners will increase annually on average by 1,000 rubles, and by 2024 it will reach 20,000 rubles.
Sustainable economic growth based on increased labor productivity and accelerated socio-economic development of the regions should become the basis for achieving this objective. At the federal level, support will continue to be provided to certain categories of citizens, the minimum wage will be set annually and the wages of public sector employees will be indexed.
3. Improved housing conditions for at least 5 million families annually. This task is expected to be accomplished mainly by reducing mortgage loan rates below 8% and developing housing construction.
4. Accelerated adoption of digital technologies into the economy and social sphere. In 2017, Russia was ranked 45th out of 176 countries in the International Telecommunication Union's ICT Development Index, following Uruguay, the Czech Republic and Portugal, ahead of Italy, Hungary, Poland and all of the BRICS countries, but significantly behind the United States, Japan, Belarus, Bahrain, Qatar, the UAE and most EU members.103 In 2018, 80.86% of Russian residents had access to the Internet,104 and there were 157.43 mobile phones per 100 residents105 (which is a good indicator). Cyber security remains a fairly serious problem.
5. Creation of a highly productive export-oriented sector in the basic economic sectors, primarily in manufacturing and agro-industrial complexes, developed on the basis of modern technologies and provided with highly qualified personnel.
Based on these objectives, the following have been identified as the most important areas of development of the Russian national economy in the coming years: demography, housing and the urban environment, education, health care, labor productivity and employment support, small and medium-sized enterprises and support for individual entrepreneurial initiatives, digital economy, safe and quality roads, international cooperation and export, ecology, science and culture.
In 2021, against the backdrop of the coronavirus pandemic, the state leadership recognized that the country's main problems are poverty and demographics. Development goals in these areas are critical for the state.
102 Средняя пенсия в России в 2018-2019 году // Bankiros [The Average Pension in Russia in 20182019, Bankiros] (Jan. 5, 2022), available at https://bankiros.ru/wiki/term/srednaa-pensia-v-rossii.
103 ICT Development Index, International Telecommunication Union (Jan. 5, 2022), available at https:// www.itu.int/net4/ITU-D/idi/2017/index.html.
104 Percentage of individuals using the Internet, International Telecommunication Union (Jan. 5, 2022), available at https://www.itu.int/en/ITU^D/Statistics/Pages/stat/default.aspx.
105 Mobile-Cellular Telephone Subscriptions Per 100 Habitants, International Telecommunication Union (Jan. 5, 2022), available at https://www.itu.int/en/ITU-D/Statistics/Pages/stat/default.aspx.
6. Research Results
The analysis of national programs and development priorities of the economies of the BRICS member countries has shown that the programs of Russia and China are the most comprehensive. Brazil's development priorities, the socio-economic development policy of India and South Africa's national development plan are primarily aimed at overcoming the problems inherent in these countries. Among the main areas of interest for all of the BRICS countries are agriculture, digital economy, energy, environment, education and health, finances, labour and employment, infrastructure and transport, trade. It is important to note that these areas of cooperation were also mentioned in the Moscow Declaration of the 12th BRICS Summit and in the New Delhi Declaration of the 13th BRICS Summit.
Economic cooperation within the BRICS framework is mainly conducted in areas where there is a convergence of member countries' interests. This is explained by the fact that BRICS is not an institutionalized association founded on an international agreement with binding rules.
Cooperation between the BRICS countries is likely to develop mainly through the exchange of experiences and best practices, joint research and realization of specific economic projects supervised by executive authorities, central banks and other state bodies. An important institution for economic interaction between the BRICS countries is the New Development Bank. Other successful mechanisms of economic cooperation include the Contingent Reserve Arrangement, the Energy Research Cooperation Platform and the Partnership on New Industrial Revolution. All of these areas of interaction are consistently developed in statements following the results of the annual summits of the BRICS leaders, as well as on specialized tracks.
A promising area of cooperation in BRICS, which is of undoubted interest to Russia, is nuclear and hydropower. In all countries, electricity has so far been generated mainly from power plants that use coal as their fuel source and whose combustion products have a negative impact on the environment. Therefore, the energy policies of the BRICS countries are focused on the use of clean energy sources with a greater emphasis on renewable sources. We believe it would be expedient for the Rosatom State Atomic Energy Corporation to continue promoting the construction of Russian nuclear reactors in the BRICS countries and for the Ministry of Energy to continue promoting Russia's ability to build small hydropower plants.
All of the BRICS countries pay great attention to the development of transport infrastructure, and China's One Belt, One Way initiative envisages the creation of transport corridors. It appears that the main direction of cooperation in the transport sphere will be the formation of transport and logistics corridors, including the active development and use of the Northern Sea Route, which is economically important for Russia (it will allow the country to build ports in the north) and other countries (using this corridor reduces the time and cost of delivery of goods from Asia to Europe).
Cooperation in the field of aviation is of practical importance for the BRICS countries. The task of Russia's Ministry of Transport for the coming years should be cooperation in the areas provided for in the partnership agreement on local airlines dated 26 July 2018.
All of the BRICS members pay great attention to improving food security, increasing the yield of agricultural products and livestock productivity, adapting plants to local weather conditions and increasing planting yields and soil fertility. In this regard, information and experience exchange, technology development and training under the BRICS Agricultural Research Platform Coordination Centre are promising. It is important for Russia's Ministry of Agriculture to take an active part in the work of this center, as well as learn from the experience of the Brazilian Agricultural Research Corporation and establish cooperation with Chinese centers specializing in biotechnology.
As all of the BRICS countries are actively introducing information and communication technologies into all areas of life, cooperation in the digital economy is important. Russia's Ministry of Digital Development, Communications and Mass Media should intensify joint research in areas such as cloud computing and information storage, big data, Internet of Things, blockades, telemedicine, fifth generation mobile networks, smart cities and transportation.
Russia's Ministry of Natural Resources should intensify cooperation under the Memorandum of Understanding on Cooperation in Environmental Protection of 18 July 2018 to exchange information and conduct joint research on clean energy sources, water resources, air quality, climate change, circular economy and other topics.
One of the main objectives of all the BRICS countries is to improve the quality of education. The Russia's Ministry of Education and Science should study the experience of BRICS partners in this area, particularly in creating systems for monitoring the labor market, forecasting human resources needs and strengthening ties between educational institutions and government organizations, enterprises and companies. In addition, it would be advisable to promote the mobility of teachers and students and the implementation of double diploma programs, as well as to intensify interest among young people to seek employment by increasing the attractiveness of careers in professional occupations.
Cooperation among BRICS appears to have promising prospects in the health sector. All of the member countries face similar problems, such as the quality of medical services in rural areas, high rates of infectious, cardiovascular, cancer and other diseases. The main task for the coming years appears to be to implement the action plans developed within the BRICS working groups, including those on HIV/AIDS, tuberculosis and cardiovascular diseases. Joint research on diagnosis of treatment methods and epidemic control, as well as the exchange of experience in training specialists in traditional medicine is also promising.
Culture and tourism are soft power tools that can be used to strengthen the BRICS partnership. Russia's Ministry of Culture should strengthen cooperation by organizing festivals and days of culture and cinema, exchanging creative teams, facilitating contacts between libraries and museums, exchanging copies of documents and materials on the history and culture of member states. Rostourism, the Russian Federal Tourism Agency, should contribute to the growth of tourist flows from BRICS countries to Russia and from Russia to BRICS countries.
Of course, the COVID-19 pandemic has had a significant impact on the short and medium term outcomes of the BRICS countries' development goals. However, it is encouraging that at the end of 2021, the BRICS leaders noted that, despite the ongoing challenges posed by the COVID-19 pandemic, BRICS has maintained momentum and continuity, while consolidating its activities in the spirit of consensus.
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Information about the authors
Venera Shaidullina (Moscow, Russia) - Founder, Digital Platform for Legal Initiatives "Initiator" (4 Avangardnaia St., Moscow, 143401, Russia; e-mail: vk.shaydullina@ gmail.com).
Igor Semenovskiy (Moscow, Russia) - Senior Lecturer, Department of International and Public Law, Financial University under the Government of the Russian Federation (49 Leningradskii Av., Moscow, 125993, Russia; e-mail: [email protected]).
