BRICS Ditches Common Currency Plan, Focuses on Local Trade

The BRICS grouping has no plans to introduce a common currency, according to India's Ministry of External Affairs Secretary (Economic Relations) Sudhakar Dalela. The focus is instead on expanding trade in national currencies to reduce transaction costs and reliance on the US dollar.

Local currency settlement has been discussed within BRICS for over a decade, with targeted frameworks being developed bilaterally and within the grouping. This approach aims to strengthen economic integration among member states and address the aspirations of the Global South.

The push for greater use of local currencies is part of BRICS' broader effort to reduce dependence on the US dollar in international trade, reserves, and financial settlements. Rather than seeking an overnight replacement for the dollar, the approach focuses on gradually creating a less dollar-dependent financial system that could help member economies shield themselves from external shocks.