In a significant development amidst global discussions on economic shifts, Reserve Bank of India (RBI) Governor Shaktikanta Das clarified that India has no plans for de-dollarisation. This announcement comes in response to recent remarks by U.S. President-elect Donald Trump, who threatened 100% tariffs on BRICS nations planning a common currency.
BRICS Currency: An Idea, Not a Decision
Governor Das highlighted that the concept of a BRICS currency was merely an idea proposed by one of the member nations and was discussed during earlier deliberations. However, he emphasized, “No decision has been taken in the matter.” The geographical spread and lack of continuity among BRICS nations were cited as critical factors limiting the feasibility of such a currency.
Focus on De-Risking Trade, Not De-Dollarisation
Addressing concerns over India’s stance, Das explained that the country’s current priority is to “de-risk trade,” particularly through local currency-denominated trade agreements with certain nations. “De-dollarisation is not on the table at all. Nobody is talking or thinking about it,” he affirmed.
Possible Implications of U.S. Tariff Threats
Regarding the potential impact of tariffs, Governor Das noted that any tariff war could pressure India’s exports and currency. He cautioned that such scenarios could lead to retaliatory actions from affected nations, including currency devaluation by countries like China.
India’s Economic Resilience
Reassuringly, Das expressed confidence in India’s economic stability, highlighting the country’s robust foreign exchange reserves and its ability to manage potential challenges. “We are confident of dealing with any spillovers,” he stated.
Conclusion
While the idea of de-dollarisation and a common BRICS currency continues to circulate globally, India’s stance remains clear and cautious. The focus on strengthening trade mechanisms and ensuring economic resilience underscores the country’s commitment to stability in an unpredictable global economic landscape.
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