In a bold move that could reshape the global financial landscape, India has officially endorsed a plan to create a unified payment system for the BRICS alliance.
Initially proposed by Iran, this initiative aims to challenge the US dollar’s supremacy in international trade and finance.
The BRICS alliance, comprising Brazil, Russia, India, China, and South Africa, has long sought ways to reduce their dependence on the US dollar.
BRICS Alliance Challenges Dollar Dominance: India Backs New Payment System
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- India backs BRICS plan for a unified payment system to challenge US dollar dominance.
- The proposed system aims to help BRICS nations circumvent US sanctions.
- If successful, the new BRICS currency could potentially rival the US dollar in value.
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Now, with India’s backing, this ambitious plan is gaining momentum.
In a recent interview with Russian publication TASS, Ash Narain Roy, Director of India’s Institute of Social Sciences, confirmed India’s stance.
“In principle, India favors an independent BRICS payments system,” Roy stated, emphasizing that while India supports the concept, a group consensus will be crucial for implementation.
This move comes as several BRICS nations, particularly Iran, grapple with US sanctions.
The proposed unified payment system could circumvent these restrictions by linking the bloc’s currency systems.
Nasser Kanani, spokesperson for Iran’s Ministry of Foreign Affairs, believes that the conditions are ripe for such a system, noting the ongoing shift towards national currencies in inter-BRICS transactions.
While India has been less vocal than other BRICS members on de-dollarization, its support for this proposal carries significant weight.
As one of the five founding members, India’s voice is particularly influential in BRICS decision-making.
However, Roy cautions against hasty implementation. “There is a feeling that this issue needs to be discussed systematically by different stakeholders before a decision is taken,” he explained.
“BRICS countries don’t want to create a system which may become dysfunctional. Hence, the issue will be debated, but a final decision is not expected in the near future.”
If successful, this united BRICS payment system could create a more valuable currency than the US dollar.
While this would be a monumental shift in global finance, it faces significant challenges.
The US dollar has long been the world’s most powerful payment system, and dislodging it from this position will be no small feat.
Nevertheless, the BRICS alliance sees this new financial system as a potential tool to circumvent sanctions and reduce its vulnerability to US financial policies.
As geopolitical tensions rise and the global economic order evolves, this move by the BRICS nations could mark a significant turning point in international finance.
The world will be watching closely as this story develops, with potentially far-reaching implications for global trade, finance, and power dynamics.
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