Mint Explainer: What is the battle over BRICS common currency?
international trade and finance. – Some experts have speculated that a BRICS currency may grow to challenge the dollar’s eminence in the global economy.
All member countries are acutely aware that the dollar allows disproportionate economic power to countries like the US. – This was made clear after a slew of sanctions were placed on Russia’s financial and banking system after its invasion of Ukraine.
The “weaponisation" of the building blocks of global finance, like the SWIFT messaging system, have been viewed with unease in many capitals, including in New Delhi. – However, this does not mean that India has supported the creation of a common BRICS currency.
India’s external affairs minister S Jaishankar said as much in July when he stated that there was no idea for a BRICS currency. – The chief financial officer of the New Development Bank, which is also known as the BRICS Bank, said in an interview that the grouping had no immediate plans for a common currency.
– Jim O’Neill, an economist and commentator, widely credited with popularizing the idea of BRICS in the early 2000s, savaged the idea that BRICS nations could establish a common currency. Among other things, O’Neill pointed out that political tensions between India and China would complicate any such efforts.
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