The ministry of external affairs on Saturday issued clarification on whether there had been discussion among the BRICS member nations over having a common currency.
In response to a reporter's query on the matter, Secretary (Economic Relations) in the MEA, Sudhakar Dalela, said there was no proposal in the BRICS for a common currency “as of now.”
Dalela further said that the focus at present remains on settling bilateral trade in local currencies so as to reduce transactions costs. The remarks come a day after India urged BRICS nations to link their payment systems to allow trade in local currencies.
Deep Dive
Why is there currently no proposal for a common BRICS currency?
How are BRICS nations working toward reducing transaction costs in trade?
What steps are being taken to enhance economic resilience within BRICS?
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What did MEA say on BRICS currency?
Dalela, while answering a question on common currency, said, “You also asked a question about BRICS currency and I would like to say that there is no proposal in the BRICS for BRICS currency as of now.”
He further added, “I would like to say that all these questions about trade in local currency and other payment system – the focus is how can we do more intra BRICS trade, and how we can engage with the global business community more actively, and reduce transaction costs. …These are and we are trying to develop bilaterally or within BRICS.”
BRICS declaration, member states on local currencies
{{/usCountry}}He further added, “I would like to say that all these questions about trade in local currency and other payment system – the focus is how can we do more intra BRICS trade, and how we can engage with the global business community more actively, and reduce transaction costs. …These are and we are trying to develop bilaterally or within BRICS.”
BRICS declaration, member states on local currencies
{{/usCountry}}The joint declaration adopted by BRICS member states unanimously in New Delhi on Saturday acknowledged the bloc's efforts to study the cross-border interoperability of payment channels, and discussions on promoting trade settlements in local currencies.
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“We acknowledge the efforts of the BRICS Payment Task Force (BPTF) towards exploring pragmatic solutions for efficient cross-border payment mechanisms, drawing on the guidance, provided by us in the Kazan and Rio Declarations, on the BRICS Cross-Border Payments Initiative,” the declaration said.
It further added, “In this regard, we acknowledge the work done to study the cross-border interoperability of payment and messaging channels, and the discussions on promoting trade settlements and investments using BRICS local currencies, while respecting national priorities and acknowledging that there is no one-size-fits-all approach.” The bloc encouraged the BPTF to continue discussions and building on the ongoing work to facilitate practical solutions for cross-border payments among BRICS countries “which are fast, low-cost, more accessible, efficient, transparent, and safe.”
At the BRICS Business Forum on Friday, commerce and industry minister Piyush Goyal urged member nations and partner countries to “link our payment systems, trade, in each other’s local currencies.”
Russian minister of economic development Maxim Reshetnikov, meanwhile, said Moscow was increasingly settling trade in local currencies. “Three years ago, dollar and euro totaled 85% of settlements for Russian exports. The figure now stands at about 11%,” he said. He proposed a BRICS grain exchange, arguing that member countries were among the world’s leading producers and consumers of grain but still relied on price benchmarks set in other markets.
Iranian President Masoud Pezeshkian also urged BRICS countries to increase the use of national currencies for trade and take steps for greater economic integration to overcome the impact of sanctions that has intensified in recent months at the business forum.