Nirmala Sitharaman calls Brics key to reforming global order amid institutional crisis
Speaking at the Brics Finance Ministers and Central Bank Governors meeting in Rio de Janeiro, the finance minister said that Brics must lead by example by reinforcing cooperation, advocating credible reforms, and amplifying the voice of the Global South.
Reflecting on the current trade environment where tariffs have become weapons to promote free and fair trade, she said India's policy response to trade and financial restrictions has focused on diversifying markets, promoting infrastructure-led growth, and implementing structural reforms aimed at boosting competitiveness and productivity.
Sitharaman highlighted India's demonstrated resilience through a combination of strong domestic demand, prudent macroeconomic management, and targeted fiscal measures, the finance ministry said a post on social media platform X.
The finance minister said that while South-South cooperation remains vital in advancing climate and development goals, the Global South should not be expected to carry the main burden of climate action, and the Brics countries are well placed to deepen cooperation on sustainable development.
The finance minister also met finance ministers from various parts of the globe and reiterated the resolve to maintain Brics as a grouping that represents the voice of the Global South.
The statements come at a time when US President Donald Trump has warned that countries which side with the policies of the Brics alliance that go against US interests will be hit with an extra 10% tariff.
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The Hindu
14 minutes ago
- The Hindu
Why is Trump taking aim at BRICS?
The story so far: U.S. President Donald Trump's threat to impose 10% tariffs on members of the BRICS grouping that held a summit in Rio de Janeiro this week is the latest in a series of similar threats. Why is BRICS in Mr. Trump's cross-hairs? Even before he was sworn in as U.S. President for the second time, Donald Trump had made it clear that he saw the BRICS grouping as 'anti-American' and a threat to the dollar that he needed to neutralise. On November 30 last year, Mr. Trump said the U.S. would require BRICS members to commit that they would not create a new BRICS common currency, 'nor back any other currency to replace the mighty U.S. dollar', threatening 100% tariffs on them. It's a threat he has repeated several times since. Mr. Trump's irritation appears to stem from BRICS declarations in South Africa in 2023 and Russia in 2024, where members that now also include Egypt, Ethiopia, Indonesia, Iran and the UAE, discussed a BRICS Cross-Border Payments Initiative that aims to facilitate trade and investment within BRICS countries using local currencies and other mechanisms. The initiative built momentum due to the problems Western sanctions on Russia have meant for trading partners in the Global South. What has the U.S. threatened to do? Last Sunday (July 6, 2025), just as BRICS leaders gathered in Rio for the 17th BRICS summit, Mr. Trump said in a social media post that any country aligning with BRICS would face a 10% added tariff. The penalty was 'just for that one thing' of being a member, Mr. Trump said later. It is unclear why the tariff rate was dropped to a tenth from the original threat of 100%, and even whether Mr. Trump will go through with the BRICS tariffs along with other reciprocal tariffs planned for August 1. But there seems little doubt that Mr. Trump wants BRICS de-fanged. 'You can tell the (U.S.) President is (upset) every time he looks at the BRICS de-dollarisation effort…(and) Rio didn't help,' said Steve Bannon, Trump's former White House chief strategist, according to Politico magazine. Editorial | Building resilience: On the 17th Summit of BRICS emerging economies In addition, the Trump administration has slapped 50% tariffs on Brazil after accusing President Lula da Silva of a 'witch-hunt' against former Brazilian President Jair Bolsonaro, who faces charges of attempted coup. It has also imposed 30% tariffs on South Africa after accusing it of unequal trade, as well as expressing concerns over the treatment of Afrikaners (White South Africans). Republican Senators close to Mr. Trump also plan to bring a bill called the Sanctioning Russia Act of 2025 that seeks to place 500% tariffs on imports of oil and sanctioned Russian products, which would hurt Russia, as well as India and China, its two biggest importers. Are Mr. Trump's concerns valid? Mr. Trump's concerns about de-dollarisation have been denied by practically every BRICS member. The South African Ministry of Foreign Affairs issued a detailed statement explaining why the BRICS attempt to use national currencies within the grouping is not the same as replacing the dollar as the global standard. While anti-U.S. rhetoric of some BRICS leaders has been harsh, the wording of the BRICS Rio declaration 2025 issued this week does not directly challenge the U.S. or the dollar. In the operative Paragraph 50, the leaders said they resolved to task ministers of finance and central bank governors 'to continue the discussion on the BRICS Cross-Border Payments Initiative and acknowledge the progress made by the BRICS Payment Task Force (BPTF) in identifying possible pathways to support the continuation of discussions on the potential for greater interoperability of BRICS payment systems.' Paragraph 13 expressed 'serious concerns' over the rise of unilateral tariff and non-tariff measures but didn't name the U.S. Where does India stand? The Modi government, hopeful of clinching a Free Trade Agreement with the U.S., has strenuously objected to Mr. Trump's categorisation of the BRICS as 'anti-American'. Also read: India will give a 'new form' to BRICS grouping in 2026: PM Modi In a parliamentary response on December 2, 2024, the MoS (Finance) Pankaj Chaudhury made it clear that the U.S. allegations referred to a report prepared by Russia during its chairmanship of BRICS, where it had spoken of 'possible alternatives relating to cross-border payments' and 'leveraging existing technology to find an alternative currency'. He added that the report was only 'taken note of' by other BRICS members, not adopted. In March 2025, External Affairs Minister S. Jaishankar was more categorical, saying there is no Indian policy to replace the dollar. He conceded, however, that BRICS members had differences, and there was no unified position of the grouping on the issue.
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Rising South: An order rebalanced
US President Donald Trump has, in his inimitable style, once again taken to social media to issue a threat to the BRICS countries huddled together to devise strategies against the US tariff attacks. 'Any country aligning with the anti-American policies of BRICS will be charged an ADDITIONAL 10 per cent tariff,' he said, hours after the BRICS finance ministers issued a statement that criticised the tariffs, calling them a threat to the global virtually to the BRICS gathering, Russian President Putin reiterated his suggestion of greater financial independence from the US dollar in international trade settlements. Trump is understandably annoyed at the revival of this narrative of criticising Trump's use of tariffs as a coercive policy to force countries to enter bilateral trade deals that favour the US, the BRICS summit proposed a series of reforms in the International Monetary Fund (IMF) and its currency valuation methods. According to the BRICS economic advocacy group, in the current economic uncertainty, the IMF needs to embrace urgent reforms in the quota system to increase the representation and voting power of developing countries, as the present system promotes dominance of advanced economies. The BRICS nations are also calling for an end to the 'gentlemen's agreement' which has historically favoured European countries in the IMF's leadership financial institutions, especially the two Bretton Woods institutions – the IMF and the World Bank (WB) – did play a significant role in the international financial architecture for some years. But they could not prevent the financial crisis nor bail the developed economies out of the crisis, much of which was their own creation. It has also been noted that their working and decision-making process continued to be greatly influenced by the developed 'North' and less relevant to the developing or underdeveloped 'South'. The last two or three decades have seen the global growth engine shift from the North to the South, which now houses three of the world's largest economies. Meanwhile, groupings such as BIMSTEC, BRICS, ASEAN, and SCO have added tremendous muscle to the emerging South-South countries add up to represent about 49% of the world's population, 39% of the global GDP, and 23% of international trade. In a changing geopolitical and geo-economic setting, when the US under Trump's administration is looking to withdraw from global institutions and looking more inwards in its quest for Making America Great Again (MAGA), the post-World War II economic institutions cannot expect to be relevant and succeed in their original objectives by remaining within a seven decades-old organisational structure. They must either reinvent themselves or face the possibility of paling into BRICS financial institutions and efforts under the South-South Cooperation (SSC) are assured signs of a collective leadership that is aligned with a multilateral world order – these are realities of the present era. The rise of the South, the emerging economies, and India's leadership role in SSC promise an alternative to archaic perceptions that are far removed from ground realities, and to the North and its tired leadership. Blocking the progress of BRICS will serve no real purpose for America or the attempts to create roadblocks for BRICS are born out of apprehensions of a challenge to the America-led world order, which is creaking under its own weight of contradictions. The independent non-dollar trade settlement system, which the BRICS is considering, may not be a reality soon, but it is born out of necessity, from the dollar's failure to meet the challenges and needs of the present era. The bilateral and multilateral economic, security, and strategic arrangements under the BRICS agenda need not necessarily hurt the interests of the US or any other grouping unless there is an established clash of interests, which in a highly globalised world would be detrimental for everyone play an important role in understanding the geopolitical and geo-economic dynamics of any given time. The decisions, economic or otherwise, the interpretations of meetings and events, and policy formulations made on flawed perceptions will lead to detrimental results. America and the rest of the Western world have to learn from past errors of judgement and look at the emerging institutions of the South, such as BRICS, from a new perspective. The shift is real – looking away cannot alter that reality.
Time of India
2 hours ago
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FM reaffirms Centre's commitment to NE devpt at Shillong stakeholder meet
1 2 Shillong: Union finance minister Nirmala Sitharaman chaired a stakeholder interaction in Shillong on Saturday, where she engaged directly with business leaders, entrepreneurs, industry representatives and citizens, reaffirming the Centre's commitment to the development of the northeast. The event was organised by the Govt of Meghalaya in collaboration with the department of financial services, Central Board of Indirect Taxes & Customs (CBIC) and the Central Board of Direct Taxes. The session was attended by CBIC chairman Sanjay Kumar Agarwal, CBIC member Mohan Kumar Singh and senior officials from the Union ministry of finance, the Govt of Meghalaya and associated departments. In a recognition, Sitharaman felicitated Rimiful Shylla and Wanjoplin, two of Meghalaya's top women taxpayers, for their commendable contribution to the nation's tax system. During the interaction, stakeholders shared a range of observations and suggestions. Key issues included the need to ensure a balanced approach to the development that upholds environmental sustainability, the importance of fostering research and development and financial assistance for institution involved in R&D and greater policy attention to the hospitality sector. Participants also highlighted the need to bring local industries under the Targeted Champion Sector Scheme, extend better access to credit and markets for startups and MSMEs — especially those rooted in the northeast — and enhance central infrastructure investments to boost regional industrial growth. Concerns over high logistics costs because of the region's geographical challenges were also raised, with calls for rationalised transport subsidies. Sitharaman welcomed the inputs and reaffirmed the Centre's commitment to inclusive, responsive and region-specific governance. She underscored the importance of participatory policy-making and said the govt is working to make tax systems and financial frameworks more accessible for all stakeholders.
