The BRICS group of emerging powers on Tuesday created a Shanghai-based development bank and a reserve fund seen as alternatives to Western-led institutions.

The leaders of Brazil, Russia, India, China and South Africa agreed to launch the institutions to finance infrastructure projects and head off future economic crises.

"We took the historic decision to create the BRICS bank and the reserve agreement '" an important contribution to reconfigure the system of international economic governance," Brazilian President Dilma Rousseff said at a summit in the northeastern seaside city of Fortaleza.