BRICS member India remains skeptical of a common BRICS currency citing risks of alienating global trade ties with the US. Leading import and export businesses in India and those stationed in the US want to keep the US dollar intact. Indian businesses are now cautious in embracing a common currency as it risks disrupting the normal flow of commerce.
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The evolving framework of the BRICS alliance is moving towards the formation of a new common currency for trade. It challenges the global economic system but the push towards a common currency is usually made by China and Russia. Indian businesses are concerned that a common BRICS currency gives power to China and make its economy influential.
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BRICS: India Disinterested in Common Currency, Wants the US Dollar
Businesses in India need the US dollar to survive as the currency provides security during economic turbulence. A BRICS currency will only benefit China and Russia as both countries are using the bloc as a stepping stone to further their global dominance agenda. Russia is reeling under sanctions while China is competing with the US dollar at the global level.
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On the other hand, India needs the dollar as it has close ties with the US through the IT, banking, and trade sectors. Its robust GDP needs the backing of the US dollar as the Indian rupee is falling to new lows. A new BRICS common currency could dent India’s prospects of becoming the third-largest economy in the world.
India’s Foreign Minister S. Jaishankar has repeatedly said that the country is not against the US dollar. He made it clear that India will work closely with the US and not dent the prospects of the dollar. Therefore, India might oppose the formation of a new BRICS common currency as the idea does not suit its economic agenda.