As the BRICS summit in Johannesburg looms on the horizon, Roman Babushkin, the Russian Deputy Chief of Mission in Delhi, has advocated trading in national currencies withing the grouping.
Speaking at a recent BRICS meeting hosted by India Foundation, Babushkin stated, “The BRICS members have been taking consistent steps to switch to settlements in national currencies for quite some time now and working out new payment mechanisms.”
This move, he suggested, would not only align with the shifting global dynamics but also foster greater financial autonomy within the group.
The meeting was chaired by President of India Foundation (IF) Dr Ram Madhav.
Babushkin took the opportunity to revisit a previous proposal made by Brazilian President Lula de Silva, who floated the idea of a single currency for BRICS.
Babushkin acknowledged the pertinence of this concept in the present context. He also referred to an idea put forward by Russian President Vladimir Putin during the previous year’s summit which revolved around the creation of an international reserve currency based on a composite currency basket representing the BRICS economies.
However, the official acknowledged the complexities involved in translating these concepts into reality.
“These ideas demonstrate new tendencies; however, it’s clear that a lot of aspects require in-depth study,” he cautioned.
One of the primary challenges he pointed out pertained to the creation of a single currency. Such a move would necessitate the establishment of a regulatory authority, alongside the synchronization of macroeconomic and monetary policies across the BRICS nations.
Another avenue proposed by Babushkin involved a BRICS payment instrument that leveraged the collective strength of the currency basket. This mechanism would enable seamless mutual settlements among the member countries, liberating them from dependence on the US dollar.
“On the other hand, a BRICS payment instrument based on the currency basket would help to carry out mutual settlements without any reliance on the US dollar,” he said.
Shifting the focus to expansion, Babushkin recognised the magnetism that BRICS held for countries that shared similar values and aspirations. He lauded the efforts of the South African presidency, highlighting the global interest in joining the alliance.
“With over one-third of the world’s GDP, a total population of around 3 billion people and a strong desire of other states to join its activities, it is safe to say that BRICS has become an integral element of an evolving multipolar paradigm,” he affirmed.
Emphasizing Russia’s profound commitment to BRICS, Babushkin said, “From the very beginning, BRICS was one of the top priorities for Russian foreign policy.”
He elaborated on the alliance’s principles, emphasizing its role in promoting equitable collaboration based on international law and legitimate national interests.
The official reiterated that BRICS aimed to complement, rather than confront, existing international economic and financial institutions.
