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India Backs Away From BRICS Currency, Reinforces Commitment to the US Dollar
• India’s central bank dismisses BRICS currency progress, calls the USD indispensable.
• Comments seen as a strategic pivot to secure U.S. trade ties and avoid Trump’s proposed tariffs.
• India balances rupee promotion with firm support for the existing dollar-based global system.
RBI Governor Rejects BRICS Currency Momentum
In a pointed departure from the BRICS de-dollarization agenda, India’s Reserve Bank Governor Sanjay Malhotra downplayed the viability of a shared BRICS currency, while openly affirming the enduring dominance of the U.S. dollar in global trade.
“As of now, there is not much work happening on a BRICS currency,” Malhotra said in an interview with The Times of India, noting that the dollar remains an “universal cross-border currency” that is not going away anytime soon.
His remarks, delivered just days after the BRICS 2025 Summit, signal a significant policy stance from one of the group’s most influential economies.
India Distances Itself From De-Dollarization Push
The RBI’s public comments come at a time when China and Russia have aggressively promoted local-currency trade and alternatives to the dollar—moves interpreted by Western analysts as an effort to weaken U.S. financial hegemony.
India, however, appears to be taking a moderated position:
Promoting local currency trade, particularly the rupee,
Avoiding full-scale de-dollarization,
And differentiating its policy from China’s yuan-based ambitions.
“It takes years, it takes decades for local currencies to gain popularity,” Malhotra said. “The dollar is going to be here for a longish time.”
Geopolitical Timing: India Shields Itself From Tariffs
Observers suggest India’s rhetoric is partly aimed at avoiding U.S. tariff threats from former President Donald Trump, who has openly warned countries against abandoning the dollar.
Following the BRICS summit, Trump imposed 50% tariffs on Brazilian goods, signaling a willingness to punish BRICS members seen as challenging U.S. financial dominance. India’s pivot, therefore, may be designed to keep U.S. trade ties intact and protect its export economy.
“India is seeking to dodge Trump’s tariffs,” Bloomberg reported. “Officials in New Delhi are informing U.S. authorities that they do not intend to undermine the greenback.”
ternal Balancing Act: Rupee Promotion Without De-Dollarization
While distancing itself from a BRICS reserve currency, India remains open to settling bilateral trade in local currencies, especially in deals with South Asia, Africa, and parts of the Middle East. This approach boosts rupee internationalization without directly challenging the dollar-based system.
The strategy:
Encourages regional economic integration,
Supports domestic growth targets,
Avoids confrontation with the U.S.
India's dual approach allows it to remain a BRICS member while maintaining trade and diplomatic alignment with Washington.
U.S.–India Trade Alliance: A Strategic Priority
The pivot appears to be paying dividends diplomatically. U.S. Vice President J.D. Vance recently praised India’s economic growth and partnership potential:
“The fate of the 21st century is going to be determined by the strength of the United States and India partnership.”
Meanwhile, Indian negotiators are continuing dialogues on trade concessions with the U.S., signaling that New Delhi sees long-term opportunity in siding with the dollar-based system rather than challenging it via the BRICS framework.
Conclusion: India Reshapes BRICS Alignment for Strategic Gains
India’s decision to publicly downplay the BRICS currency and support the U.S. dollar is more than a monetary policy signal—it’s a geopolitical maneuver. In distancing itself from the yuan-led de-dollarization campaign, India is protecting trade access, strengthening bilateral ties, and securing its place in the evolving U.S.-led financial order.
With Trump’s tariff policy back in motion and tensions within BRICS growing, New Delhi is reasserting its independence—not by exiting the bloc, but by choosing balance over confrontation.
@ Newshounds News™
Source: Watcher.Guru
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