Amid trade wars and conflicts, New Delhi must strengthen its associations with BRICS

Indian Express

02-07-2025

The BRICS summit in Rio is happening as the global order grapples with two forms of interstate conflicts: Trade wars and regional wars. These conflicts demonstrate the international order's limitations and the existing institutions' inability to contain the crises. States are adopting myriad hedging and balancing strategies to cope with the new challenges.
The US is trying to withdraw from and limit its external engagements, while other countries are joining alternative institutions to safeguard their interests. The world is at a juncture where the hegemon cannot ensure compliance of others and the successors are reluctant to provide leadership and take responsibility.
Under these circumstances, emerging powers find it advantageous to group together and amplify their influence. Amid a turbulent and unpredictable world order, BRICS functions as a key instrument of a broader hedging and diversification strategy. Members view this as a critical alternative forum that provides a sense of security, status, and collective leadership. BRICS has become a coveted organisation for the Global South. It comprises 11 states with nearly 50 per cent of the global population and about 40 per cent of the global GDP. It is a heterogeneous organisation with no shared history, culture, ideology or territories. It cannot be compared with any other existing organisation given its diversity and uniqueness. Experts often compare it with the G7 because of its global outreach, but the G7 countries have identical political systems and a comparable level of development. The same cannot be said about BRICS. Because BRICS is an organisation of the non-West, it is often viewed as a challenge to the West.
It is not without reason that Donald Trump threatened to slap a 100 per cent tariff on BRICS countries if they sought to develop an alternative currency. Many in the West fear that a BRICS currency would weaken the dollar. However, it must be underlined that BRICS is not in the process of developing a new currency. A common currency requires integrating financial institutions and closely coordinating industrial and agricultural policies. BRICS does not have the level of coordination needed and is not pursuing such a goal. Therefore, this Western fear is entirely misplaced.
Instead, BRICS is exploring the possibility of amplifying trade in national currencies. The trade between Russia and China is carried out in national currencies. Similarly, a large part of Russia's trade with India and Brazil occurs in local currencies. These states are also trying to set up fixed reference rates for their local currencies, independent of the dollar. The extent of the impact of this process on the dollar is unclear, but BRICS states should expect new threats from the Trump administration. It would be viewed as an attempt at de-dollarisation, and President Trump cannot remain silent for long. In a recent interview, US Secretary of Commerce, Howard Lutnick, described India's association with BRICS as an irritant which rubbed America the wrong way. Nonetheless, New Delhi will continue to follow a diversified multi-engagement policy, disregarding external pressure. Prime Minister Narendra Modi will attend the Rio summit, even as Xi Jinping and Putin give it a pass.
The BRICS summit in Rio De Janeiro is conspicuous for several reasons: First, following its expansion in 2024 and 2025, it would be the first time that all the members will participate. It provides an important platform for them to socialise, explore the areas of cooperation and develop an understanding of each other's concerns. Further, the BRICS membership enhances the status of new members. However, the expansion of the organisation will also pose coordination and consensus-building challenges.
Second, the issue of the Israel-Iran conflict is likely to figure prominently in discussions. A few days ago, BRICS issued a joint statement condemning the Israeli attack on Iran as a violation of international law and the UN Charter. This assumes significance because India had distanced itself from a joint statement at the SCO meeting previously. In a world where states do not want to be seen taking a stand against Trump, Iran finds many supporters at the BRICS forum.
Third, the expansion of BRICS has enabled greater representation of the Global South. At a time when the US is withdrawing from its global responsibilities of peace and security, climate action, the WTO and the WHO, BRICS has the opportunity to fill the vacuum and protect the interests of the Global South. BRICS can simultaneously focus on reforms in West-dominated institutions and enhanced cooperation in the South. The Rio summit will focus on the ethical use of artificial intelligence (AI), climate action, global health, reforming global governance, and peace and security. Since the Trump administration holds contrarian views on these issues, the only hope is greater cooperation among countries of the Global South.
Fourth, Xi Jinping would not be present at the Rio summit. Premier Li Qiang will be representing China. Xi's absence has led to speculations of a fraying unity, strains in ties between China and Brazil and Prime Minister Lula Da Silva's invitation to PM Modi for a state dinner. It is not easy to find the real reason, but Brazil views it as a diplomatic slight. Silva's advisor Celso Amorim once stated that 'BRICS without China is not BRICS'. This would be the first time that China's president will not be present at the summit. This is surprising because Brazil has good ties with China, and PM Silva recently visited Beijing. Russia's president, Vladimir Putin, will also not participate in person because of the International Criminal Court (ICC) warrant issued against him.
Finally, New Delhi must strengthen its associations with BRICS. In a world where Trump's whimsical policies send shockwaves, India needs closer ties with alternative regional powers. India lends immense credibility to the organisation and seeks to gain a lot in the future. New Delhi's strong ties with Washington should not come in the way of its associations with BRICS. PM Modi and his team will have an opportunity to sensitise the members on issues like digital inclusion, sustainable development, climate action, poverty elimination, and terrorism. In a favourable development, New Delhi has aligned its stance with other members on Israel's attack on Iran. It is likely to receive support from others on the issue of terrorism in reciprocation.
The writer teaches at the School of International Studies, Jawaharlal Nehru University, Delhi. Views are personal