India proposes BRICS digital currency link for trade

India proposes linking BRICS digital currencies to ease cross-border payments, cut dollar reliance, and boost sovereignty, with a formal agenda item for the 2026 BRICS summit.

The Reserve Bank of India (RBI) has proposed linking the central bank digital currencies (CBDCs) of BRICS nations—Brazil, Russia, India, China, and South Africa—to streamline cross-border trade and tourism payments. This initiative aims to reduce reliance on the US dollar and strengthen financial sovereignty among member countries. The RBI recommends including this proposal on the agenda for the 2026 BRICS summit, which India will host. The plan involves developing a technical framework for direct currency conversion between BRICS members, potentially lowering transaction costs and settlement times. Although none of the BRICS nations have fully launched their CBDCs, all are conducting pilot projects. The proposal builds on a previous BRICS declaration supporting interoperable payment systems. The RBI clarified that expanding the global use of the rupee is not intended to promote de-dollarisation. Effective implementation would require consensus on technology, governance, and settlement mechanisms, with possible use of bilateral foreign exchange swaps to manage trade imbalances.