Nigeria
Source: afripoli.org

This article is part of the BRICS thought leadership series, published by APRI in collaboration with the University of Johannesburg. It explores key themes from the 16th BRICS Summit and the group's broader initiatives. The series is edited by Ada Mare, Bhaso Ndzendze, Serwah Prempeh.

Summary

• China’s strategic goal in supporting the expansion of BRICS is to create an influential “Chinese-led bloc” that could challenge Western dominance and promote a multipolar world order. It aims to position BRICS+ as a critical platform for advancing these objectives.
• China’s influence within BRICS is strengthened by its economic power, which enables it to shape the bloc’s agenda, advocate for the inclusion of new members and drive key initiatives like the New Development Bank (NDB). This bank has helped reduce the heavy reliance on Western financial institutions.
• Economic cooperation and resource access are central to China’s strategy in BRICS. China seeks to foster partnerships through trade, investment and infrastructure development, expanding its influence within the bloc and securing essential resources from member states.
• However, geopolitical challenges within BRICS pose significant obstacles. Tensions between China and India and rivalries among new members like Saudi Arabia, the UAE and Iran complicate China’s efforts to build a cohesive bloc that can effectively counter Western influence.
• China’s leadership role in BRICS moving forward is crucial. To maintain the bloc’s relevance and stability as a counterbalance to Western alliances, Beijing must address internal conflicts and promote dialogue and cooperation among member states.

Introduction

In the aftermath of the announcement of the expansion of BRICS in 2023, former US National Security Advisor John Bolton appeared on CNBC International to address concerns about the threat posed by the bloc to Western interests. Bolton described BRICS as a diverse but incompatible collection of countries, suggesting that BRICS is a heterogeneous entity, a “very mixed bag” whose members “do not go together naturally” and whose expansion does not constitute a “serious challenge”. However, Reinhard Butikofer, an EU diplomat from Germany, expressed a different perspective, stating that the recent expansion of BRICS threatens Western dominance. According to Butikofer, BRICS is becoming increasingly confrontational toward the West, and many developing countries may turn to the bloc if Europe fails to prove its reliability and credibility as a fair partner.

These different perspectives on the implications of BRICS’ expansion present a compelling subject for exploration, as they highlight the complex dynamics of the members’ strategic interests and their influence within the bloc. As the largest economy within BRICS, China helps shape the bloc’s agenda and priorities. Given this context, exploring China’s strategic interests within BRICS becomes even more relevant. China’s evolving role, especially regarding its economic and geopolitical objectives and challenges, must be considered in the broader context of BRICS’ efforts to navigate global challenges. However, discussions on BRICS’ expansion overlook a critical question: How do China’s strategic interests shape the bloc’s agenda and decision-making processes, and what are the implications of this influence for global governance and economic cooperation? This knowledge gap hinders a comprehensive understanding of BRICS’ evolving role in international affairs. Building on the groundwork of literature on BRICS, this paper seeks to unpack the bloc’s expansion with a focus on China’s strategic interests and motivations, the obstacles and the potential implications of a Chinese-led bloc constructed from BRICS for the balance of power.

BRICS: An overview and the impact of the bloc

In 2001, Jim O’Neill introduced the acronym ‘BRIC’ to represent the rapidly developing economies of Brazil, Russia, India and China. O’Neill viewed these countries as four emerging economies poised to exert significant global dominance. With much emphasis on China, O’Neill’s critical arguments for the BRIC group were based on three central potentials. First, these nations were rapidly advancing economies with sizable and growing populations, abundant natural resources and expanding consumer markets, all of which supported their economic potential. Second, regarding global influence, the bloc was increasingly assuming influential roles in the global economy, challenging traditional Western dominance and changing global power dynamics. Last but not least, they offered attractive opportunities for foreign direct investment (FDI), business expansion and promising investment returns.

Despite these attributes, the bloc has been met with scepticism and pessimism. Many critics have expressed concerns about its durability and unity. Western powers and established international bodies have also voiced doubts about the significance and effectiveness of the bloc as a platform for emerging economies. It is fair to acknowledge that specific arguments raised by sceptics were grounded in concrete assumptions about economic, geopolitical and institutional considerations that underscored the potential impact and relevance of the bloc on global dynamics.

However, throughout its existence, BRICS, through a joint effort, has emerged as an important alliance capable of altering the global power structure. It is important to highlight its key developments, initiatives and achievements amid criticisms and a changing global landscape. The BRICS countries have also been instrumental in reshaping the world economy by offering an alternative funding source for infrastructure projects. The New Development Bank (NDB), established in 2014, finances infrastructure and sustainable development projects in member countries and developing nations. This initiative provides an alternative to the Bretton Woods institutions, notably the World Bank and the International Monetary Fund, often viewed as Western-dominated entities. By 2022, for instance, the NDB had a total investment portfolio of USD 30.2 billion allocated to 85 ventures spanning sectors such as renewable energy, transportation, water and sanitation, environmental conservation, social infrastructure and digital technology.

The NDB has prioritised sustainable development in its funding decisions. NDB-funded projects emphasise environmental sustainability, social inclusiveness and economic viability, contributing to the United Nations Sustainable Development Goals (SDGs). By investing in critical sectors such as transportation, energy and water management, the bank has enhanced connectivity and promoted sustainable development within the region. The NDB has also collaborated with other multilateral institutions and development banks to co-finance projects and leverage expertise, thereby increasing the impact and reach of NDB-funded initiatives.

The combined GDP of the BRICS countries has expanded significantly since the bloc’s establishment, and they have emerged as major drivers of the global economy. These countries have also made significant progress towards economic cooperation and integration due to their increasing economic strength. There have been evident strides in critical areas such as South-South cooperation, trade and institutional cooperation, and concerted action to address global challenges. China and Russia have also spearheaded efforts to reduce dependence on the US dollar in global trade as part of a broader strategy to weaken US financial hegemony. China, for instance, has pushed for the use of the Chinese yuan in international transactions. Russia has similarly moved towards trade in rubles or other local currencies, particularly in response to Western sanctions.

Beyond economic cooperation, BRICS has gained significant geopolitical influence and has become notable for taking a contrary position on global issues. For example, the stance of BRICS on the conflicts in Ukraine and Gaza contradicts that of many Western countries, reflecting broader geopolitical divides. In the case of Gaza, the bloc has condemned and called for an end to the conflict, contrasting sharply with Western countries’ strong support for Israel. Through their collective strengths, the bloc has also solidified its position on other global issues, such as climate change, and often advocates for climate justice and financial support for developing nations in global climate discussions. This advocacy directly contrasts with the Western stance, which tends to focus on immediate emission reductions from all countries, often without addressing the historical responsibility of industrialised nations. At COP27 in 2022, the bloc advocated for the loss and damage fund. This fund aims to compensate poorer countries for climate-related destruction, highlighting a direct challenge to Western reluctance to acknowledge past emissions. The fund represents BRICS’ broader strategy of promoting equity in global climate governance.

All in all, initially criticised as a ‘lazy acronym’ and an ‘arranged marriage’, the BRIC concept has unarguably evolved. The transition from ‘BRIC’ to ‘BRICS’ with the inclusion of South Africa in 2010 marked the bloc’s first expansion. At the 15th Summit in Johannesburg, the bloc doubled its membership by adding vital regional players like Ethiopia, Egypt, Iran, Saudi Arabia and the United Arab Emirates. This inclusion positions BRICS as a powerful bloc representing 45% of the world’s population, 28% of global GDP, 25% of global trade, 40% of global oil production and 25% of the world’s landmass. This amplifies BRICS’ economic and demographic significance and diversifies and strengthens its strategic reach. As a consequence, BRICS can exert more significant influence in shaping global economic policies, trade agreements and security arrangements, posing a formidable challenge to traditional Western hegemony.

China in BRICS: Interests and influence

Amid shifting global economic and political dynamics, understanding China’s strategic interests and influence within BRICS is critical to grasping its ambitions. As the largest economy in the bloc, China has pushed to deepen cooperation with other emerging economies and strengthen BRICS’ collective interests on the global stage. Beyond advocating for expanded membership, China has benefited from BRICS as a platform to counter Western dominance. Except for India, which initially was at odds over the BRICS expansion agenda, the other members – Brazil, Russia and South Africa – have all showed interest in expanding cooperation with other emerging economies, recognising the value of enhancing global governance through greater inclusion.

China’s active support for the recent BRICS expansion demonstrates its strategic interests and influence in the bloc. This expansion gives China leverage to advance the bloc’s strengths in its favour and navigate the complexities of a multipolar world. China’s plans for BRICS are using the alliance to boost its global influence through initiatives like the Belt and Road Initiative (BRI). However, other members have different priorities. Russia, for instance, is currently grappling with Western sanctions and sees BRICS as a way to counterbalance them by diversifying its economic partnerships, though the country’s economic leverage is limited compared to China’s. Brazil and South Africa focus more on regional development and often seek to use BRICS to gain more significant global influence. However, their global interests are more regionally focused and less ambitious than China’s.

Beyond its expansion advocacy, China’s influence is seen through its substantial contributions to pivotal projects like the NDB and the Contingent Reserve Arrangement. China was pivotal in establishing the NDB, a financial organisation that funds infrastructure and sustainable development ventures in BRICS nations and other emerging markets. China’s substantial financial contribution to the NDB underscores its changing role in multilateral development banks and its interest in fostering economic expansion and monetary equilibrium within the coalition.

For BRICS-Africa relations, China has already established itself as a key investor in African infrastructure and resources, and its growing influence within BRICS may lead to even more coordinated efforts to deepen economic ties between BRICS and African nations. This could bring increased investment and development projects to Africa, mainly through Chinese-backed initiatives like the BRI.

However, China’s growing interest and influence within BRICS is a double-edged sword. On the one hand, its economic and geopolitical power could bring more significant infrastructure and trade connectivity to the bloc, mainly through initiatives like the BRI. This could be a game-changer for member nations, fostering economic growth and cooperation. The flip side is that China’s increasing dominance may heighten tensions with other members, especially India, which is wary of China’s expanding influence. India’s concerns are valid, considering the two nations have a complex history and competing interests in the region.

Geopolitical rivalries within BRICS

BRICS is a multinational bloc with varying domestic and geopolitical interests. This has led to geopolitical rivalry among its member nations, impacting their collective efforts and ability to shape a new world order. For example, the power struggles between China and India, the economic downturn and political instability among the bloc members could significantly impede their ability to navigate complex geopolitical landscapes.

Longstanding border conflicts and territorial disputes, such as the Doklam standoff and recent clashes in the Galwan Valley, have strained bilateral relations between China and India. These developments have led to a prevailing atmosphere of suspicion between these two key bloc members. Both nations harbour historical resentments and opposing territorial contentions, hindering efforts to foster trust and enhance bilateral relations. Both countries view the border regions as strategically significant and seek to assert their influence, leading to competition for control and influence.

The ongoing geopolitical tensions between China and India may escalate further, mainly due to the significant political rifts among new players like Saudi Arabia, the UAE and Iran. China has strong ties with Iran, whereas India maintains close relationships with Saudi Arabia and the UAE. Any shifts in these alliances could increase friction. For instance, India has been cautious about the BRI, perceiving it as an economic venture and a means for China to enhance its geopolitical influence. India is especially sensitive to projects that involve neighbouring countries like Pakistan, which plays a crucial role in the BRI. This situation could intensify the existing tensions between India and China, as India may view the growing economic influence of the BRI as a way for China to overshadow its position on the global stage.

Including Saudi Arabia and Iran may also increase tensions due to their longstanding regional rivalry. Their differing interests and conflicting alliances may affect cohesion and decision-making. The escalating rift, particularly concerning regional security dynamics and maritime disputes in the Persian Gulf, adds complexity to BRICS’ relations and may impact the stability and progress of BRICS+. Additionally, this situation could have implications for global trade routes and energy flows, as disruptions in the Persian Gulf region could affect the energy security and market stability of BRICS’ economies. The likelihood of resolving these tensions within BRICS+ appears minimal.

Conclusion and Recommendations

In the context of the newly expanded BRICS, the 2024 summit in Russia marked a critical moment in shaping the future of global governance and economic cooperation. With inflation, debt crises and an uneven post-pandemic recovery at the forefront, the bloc is increasingly exploring alternative trade mechanisms, global economic restructuring and even a common currency to reduce dependence on the West. As the largest of the BRICS economies, China is mainly focused on consolidating its leadership of the bloc, enhancing economic ties with key regions and promoting its vision of a multipolar world.

Our analysis underscores China’s strategic interests within BRICS+, mainly how the bloc’s enlargement affects China’s economic and geopolitical influence. Additionally, China faces critical challenges, such as managing tensions with India and balancing divergent interests among BRICS members, all of which will shape the future trajectory of the bloc. Policymakers must consider how expansion will redefine BRICS’ global role and the implications for China’s leadership in this broader alliance.

To ensure the bloc remains a relevant and effective platform in the evolving global order, the bloc must address several strategic challenges and seize emerging opportunities. The following recommendations outline key steps BRICS+ should take moving forward:

• BRICS+ must prioritise internal cohesion by establishing mechanisms to address geopolitical tensions, particularly between China and India. Creating a formal conflict resolution framework will help the bloc manage disputes that threaten its unity, ensuring that internal rivalries do not undermine its collective goals.
• To avoid the perception of dominance by any member, BRICS should implement a rotational leadership model that allows each member to lead in agenda-setting. This would encourage more balanced decision-making and reduce concerns over China’s outsized influence within the bloc, fostering greater trust among members.
• BRICS+ should capitalise on its strategic partnerships with African countries and other emerging economies by formalising cooperation frameworks that address their development priorities. By aligning BRICS initiatives with local needs – particularly in infrastructure, resource development and technology transfer – the bloc can enhance its legitimacy and influence in the Global South, countering Western hegemony in these regions.
• BRICS+ should enhance the role of the NDB by expanding its financial capacity and reach. Increased collaboration on infrastructure projects, particularly in the Global South, can solidify the bloc’s position as a viable alternative to Western-led financial institutions, promoting shared development goals while advancing China’s vision of multipolar global governance.

Australia
Source: theconversation.com

Indonesia’s decision to pursue membership in BRICS – an emerging economy bloc comprising Brazil, Russia, India, China, and South Africa – signals that President Prabowo Subianto is steering foreign policy in a direction contrasting with his predecessors.

During Joko “Jokowi” Widodo’s two-term administration, then-former Foreign Minister Retno Marsudi led efforts to integrate Indonesia’s economy with Western institutions by working to secure membership with the OECD.

Since BRICS is an alternative to Western-dominated organisations, many observers scrutinised and questioned Indonesia’s nonalignment commitment. However, Foreign Minister Sugiono argued that BRICS aligns with Indonesia’s ‘free and active’ foreign policy, allowing Indonesia to collaborate widely without aligning too closely with any single bloc.

For Sugiono, joining BRICS means paving the way to advance the new government’s goals of food security, energy independence, poverty alleviation, and human capital development. The bloc offers access to funding, technology, and trade opportunities to tackle key challenges in those sectors. BRICS, with its emphasis on fairness and cooperation, supports Indonesia’s vision for a more inclusive and sustainable future.

The shift from Retno’s OECD focus to Sugiono’s BRICS approach reflects at least two visions. First, Indonesia seeks to reassess its strategic position as the leading economy in Southeast Asia. Second, the country seeks to switch from its nonalignment stance to multi-alignment. The later will help navigate partnerships with both developed and emerging economies, balancing traditional alliances with new opportunities.

Joining BRICS can amplify Indonesia’s influence in its already strong ties with each of the member countries and unlock opportunities beyond one-on-one partnerships.

Fear of missing out

Indonesia’s pivot to BRICS reflects both its relationship with major powers, such as China and the US, and regional pressures.

Neighbouring countries Malaysia and Thailand  have recently expressed interest in BRICS, creating a sense of competition within Southeast Asia. Both countries joining the bloc could erode Indonesia’s leadership and influence in the region, especially in affecting global affairs.

Through ASEAN, Indonesia has sought to act as a regional stabiliser and mediator amid rising polarisation between the West and China.

As its de facto leader, Indonesia has historically championed initiatives like the South China Sea Code of Conduct and Myanmar’s peace process. Its G20 presidency further underscored its role as a mediator between global powers.

This ‘fear of missing out’ has spurred Indonesia’s interest in BRICS.

Joining BRICS ahead of its regional peers ensures that Indonesia maintains its leadership position in ASEAN. For Prabowo’s administration, BRICS offers a platform to advance Indonesia’s interests in maritime security, economic growth, and global governance. It is a strategic move beyond an economic decision to amplify its voice on global issues and prevent fellow Southeast Asian countries from overtaking it in shaping the bloc’s agenda.

Bold (but not one) direction

Indonesia’s BRICS membership announcement highlights the new administration’s foreign policy ambitions, centred on two key shifts: adopting a multi-alignment strategy and strengthening its ‘good neighbour’ policy.

Prabowo envisions engaging with all nations, fostering friendly relations while opposing oppression. This approach resonates with Indonesia’s historical commitment to sovereignty and equality in international relations.

Indonesia has traditionally adhered to a nonalignment principle. This virtue has aided the country navigating major power blocs without binding itself to any single alliance. However, the current geopolitical climate – marked by intensifying tensions between global powers, regional conflicts, and intricate challenges – demands a more flexible and strategic approach.

By joining BRICS, Indonesia avoids taking sides and instead diversifies its partnerships to maximise benefits. This multi-aligned approach enables active participation in BRICS discussions on multilateral reform.

Prabowo’s ‘good neighbour policy’ further underscores the importance of maintaining positive relations with all countries. It empowers developing nations and advocates for a more equitable global order and economic system. This strategy also facilitates Indonesia’s resilience by fostering partnerships in food and energy security, poverty alleviation, and human capital development.
Such collaborations reduce reliance on Western financial systems and enhance Indonesia’s autonomy. Ultimately, these strategic directions position Indonesia as a sovereign and dynamic player capable of balancing global relationships while advancing its own priorities.

What about the OECD?

This move does not mean the OECD is off the table for Indonesia. Instead, Prabowo’s approach reflects a dual-track strategy that values both alliances for their respective benefits.

The OECD remains a long-term objective to enhance Indonesia’s economic governance and regulatory standards. It serves the goal of providing the country with stable relationships within the Western economic framework. Meanwhile, BRICS offers an immediate avenue for Indonesia to deepen ties with equivalent economies and actively shape policies that impact the Global South.
Sugiono’s statement in Kazan emphasised Indonesia’s commitment to engaging in other forums, including the G20 and OECD discussions. It highlighted the country’s flexibility in international alliances.

This dual-track strategy reinforces Indonesia’s role as a bridge between developed and developing nations, maximising the benefits of both alliances without sacrificing its autonomy.
What’s next for Indonesia?

Indonesia’s decision to join BRICS marks a significant evolution in its foreign policy. By participating in BRICS, Indonesia positions itself as a critical player in global discussions on economic reform and development, asserting its voice within a multi-polar world order.

Indonesia is charting a path that balances traditional alliances with emerging opportunities, reinforcing its role as a dynamic, independent player on the world stage.

United Kingdom
Source: www.omfif.org

Search continues for dollar alternatives to reimagine global settlements

The shifting dynamics of global trade and finance have intensified the search for a stable, universally accepted unit of account for international settlements. Geopolitical tensions, leading to results such as Russia’s exclusion from the Swift payment system, have accelerated efforts to find alternatives to the dollar. The Brics nations are exploring the creation of a common currency that would be pegged partly to gold and partly to a basket of their own currencies. The initiative, which would leverage distributed ledger technology as its foundation, has already drawn sharp criticism.

US President-elect Donald Trump has threatened 100% tariffs on Brics nations if they pursue a currency that challenges the dollar’s dominance. It remains unclear whether he will pursue that course after taking office on 20 January.

The Brics bloc wields undeniable economic power, accounting for roughly 40% of the world population and more than 30% of global gross domestic product – slightly ahead of the G7 in economic output. Despite this, their currencies remain underrepresented in global trade, with the dollar dominating foreign exchange transactions.

Yet intra-Brics trade accounted for 37% of their total transactions in 2022 – up by 56% since 2017 – underscoring the bloc’s determination to strengthen financial independence. For the Brics group, a gold-backed digital currency could make a big difference. Lower transaction costs and reduced exchange rate volatility are among the tangible benefits. If even 50% of intra-Brics trade shifted to such a currency, cost savings of 1% to 2% per transaction would add up to billions of dollars. These savings could be reinvested to fuel economic growth and enhance trade efficiency. DLT offers the transparency, security and efficiency necessary to underpin such a currency.

By tokenising gold reserves, each digital unit would be backed by tangible assets stored in secure vaults, with regular audits ensuring accountability. Smart contracts could dynamically adjust currency weightings, reflecting trade patterns and economic conditions. This would enable real-time settlements, reduce delays and foster trust among participants. Such a system might even attract nations outside the bloc seeking alternatives to dollar-dominated networks, potentially increasing the Brics bloc’s global trade share beyond its current 18%.

Some elements of this vision are in place. As of mid-2024, Brics nations collectively held 5,700 tonnes of gold, representing 16% of global reserves. Over the past two decades, these reserves have grown threefold, reflecting an effort to reduce dependence on the dollar and bolster their own nations’ financial stability. But the balance of gold power is still skewed heavily in favour of the G7 countries, which hold a combined 17,500 tonnes, or 49% of global reserves.

Some potential benefits of a gold-backed digital currency are discernible, but implementation will not be straightforward. Effective coordination among Brics nations is required, alongside investments in technological infrastructure. Geopolitical obstacles, including potential sanctions and tariffs, add further complexity. Nevertheless, with its strategic gold reserves and economic clout, the Brics group is likely to continue advancing ideas to reshape global finance and offer an alternative to the dollar-centric order.

country
Source: www.nkibrics.ru

A week after US President-elect Donald Trump threatened 100% tariffs against any backers of a “BRICS currency”, key emerging powers such as India have quickly distanced themselves from any BRICS-led de-dollarization initiative.

“Right now, there is no proposal to have a BRICS currency. So I’m not quite sure what is the basis for [Trump’s remark],” India’s External Affairs Minister S Jaishankar said during the Doha Forum held in New Delhi this week.

India’s top diplomat acknowledged there are ongoing discussions on streamlining and deepening “financial transactions” among BRICS nations, but he made it clear that “each country doesn’t have an identical position on this.”

“[W]here India’s concerned, the United States is our largest trade partner and we have no interest in weakening the dollar at all,” he added, emphasizing India’s prioritization of ties with the West.
Days earlier, Reserve Bank of India Governor Shaktikanta Das also clarified that “[t]here is no step which we have taken that specifically wants to de-dollarize [which] certainly [is] not our objective” despite ongoing attempts to diversify the country’s pool of foreign currency reserves.

India’s central banker also questioned the viability of a BRICS currency given the “geographical spread of the countries…unlike [common currency systems like] the eurozone which has geographical contiguity.”

Nevertheless, the next Trump administration might end up boosting prospects of a BRICS currency in his roughshod attempt to reassert American primacy.

A ham-fisted approach to bilateral relations with major rising powers, meanwhile, will likely only strengthen their resolve to band together and collectively undermine any US-led global order.
Not only India but other non-Western powers such Indonesia, Turkey, Malaysia and Saudi Arabia will also likely not only join the BRICS but also more actively contribute to new “de-dollarization” initiatives.

In recent years, America has tried to solicit international support and has been gradually building a new coalition to “de-risk” from China, particularly in high-tech items such as high-end semiconductors and the equipment used to make them.

But Trump’s likely unilateralist policies, including high blanket tariffs, could encourage rising powers, especially those in BRICS, to double down on efforts to “de-risk” from the US, paving the way for a new global order altogether.

To be sure, de-dollarization is complicated and largely still aspirational. For instance, India has struggled to effectuate its more narrow, bilateral non-dollar-denominated trade with key partners such as Russia.

Amid a historic boom in India’s import of heavily discounted Russian oil, Moscow is accumulating US$1 billion every month that it struggles to use due to both Western sanctions and India’s capital control measures.

“This is a problem,” Russia’s Foreign Minister Sergei Lavrov told reporters during last year’s Shanghai Cooperation Organization (SCO) meeting. “We need to use this money. But for this, these rupees must be transferred in another currency and this is being discussed now,” he added.
Leading Russia experts such as Alexander Knobel have warned that Russia’s mass of “frozen funds” will likely “reach tens of billions of dollars,” and that the “situation is aggravated by India’s historically high aggregate trade deficit, which reduces the possibilities of clearing settlements with third countries.”

In the past, similar problems also emerged amid a boom in non-dollar-denominated trade between Iran, another BRICS member that is also heavily sanctioned by the West, and major oil customers such as India and China.

Nevertheless, the world’s most populous nation continues to maintain robust ties with Russia, a major source of armaments and hydrocarbon goods throughout the past decades.

This week, Indian private refiner Reliance (RELI.NS) secured a massive deal with Russia’s state oil firm Rosneft (ROSN.MM). The 10-year agreement, amounting to a whopping 0.5% of the entire global supply, is worth roughly $13 billion a year.

The new deal notably accounts for roughly half of Rosneft’s seaborne oil exports, making Indian markets a leading customer.

Russian President Vladimir Putin will likely visit New Delhi in the near future, as the two BRICS members solidify trade and energy ties. The Eurasian power alone accounts for a third of India’s energy imports while the South Asian power has replaced the European Union as Russia’s top energy customer.

Eager to maintain American primacy, Trump warned over his social media platform (Truth Social) that partner nations could “face 100 per cent tariffs, and should expect to say goodbye to selling into the wonderful US economy” unless they commit to “neither create a new BRICS currency, nor back any other currency to replace the mighty US Dollar.”

Harkening back to his “Make America Great Again” foreign policy mantra, the incoming US president warned any backers of a BRICS currency: “They can go find another ‘sucker.’ There is no chance that the BRICS will replace the US dollar in international trade, and any country that tries should wave goodbye to America.”

With Trump advocating for a peace deal in Ukraine, however, some in India are hoping for lighter Western criticism of its long-standing relations with Russia. Nevertheless, the South Asian powerhouse has remained staunchly non-aligned in its foreign policy, eager to exploit great power rivalries for its own national interest.

“Whenever the West bashes us, we gain credibility in Moscow,” an informed source in New Delhi told this writer, underscoring India’s preference to play the superpowers off one another while maintaining simultaneous strong ties with both Washington and Moscow.

If anything, India’s Narendra Modi-led administration is relatively bullish on relations with a second Trump administration.

“We had a strong and solid relationship with the first Trump administration…Yes, there were some issues mostly trade-related, but there were a whole lot of issues on which President Trump was actually forward-leaning,” Jaishankar said during the Doha Forum this week.

“I would say from our perspective there is a certain personal relationship between Prime Minister Modi and President Trump. In terms of politics, we really don’t have divisive issues,” he added, underscoring New Delhi hopes to leverage personal diplomacy with the incoming US leader.
Given India’s economic momentum and its emerging centrality to global growth, it’s foreign policy leanings will be instrumental to any global de-dollarization drive.

Currently, the US dollar accounts for more than half of the world’s trade invoices and more than 80% of all international currency transactions. However, Trump’s policies could inadvertently contribute to the gradual decline of US dollar use in coming years.

On the one hand, it remains to be seen how the next US administration will deal with outstanding bilateral issues with friendly BRICS members such as India.

“A major source of concern is the fate of large number of Indians illegally residing in America,” a source in India with deep ties to Washington, DC, told this writer. As many as 18,000 Indians could face deportation in coming months if Trump enacts the draconian immigration policies he avowed on the campaign trail.

Moreover, Trump’s fiscal policies, including massive tax cuts, could add as much as $15 trillion to America’s already sky-high $36 trillion national debt. Meanwhile, Trump’s plan to impose unprecedented tariffs across the board may not only spike inflation at home but also torpedo global trade and undermine the value of foreign currency reserves held by its major trading partners.
Malaysian Prime Minister Anwar Ibrahim has welcomed the end of an American-led unipolar world and, accordingly, has pivoted to the BRICS and China, which he has described as a springboard for the creation of a more multipolar order.

For his part, Indonesia’s new president, Prabowo Subianto, has reversed his predecessor Joko Widodo’s policy by actively seeking membership in the BRICS. By joining the bloc, these new rising powers seek to bolster ties with Beijing, a major investor and trade partner, as well as express certain discontent with the US-led order.