India To Push BRICS Nations Toward Digital Currency Payments, Stops Short Of Unified Network

India is set to push fellow BRICS nations to expand the use of central bank digital currencies, or CBDCs, for cross-border trade settlement, while stopping short of backing a single, bloc-wide payments network that could be viewed as a direct challenge to the US dollar, according to people familiar with the discussions.

With India chairing BRICS this year, Prime Minister Narendra Modi is said to favour using CBDCs to settle bilateral trade between member nations rather than pursuing a unified settlement system. An agreement on a single, bloc-wide payments platform is considered unlikely at this weekend's leaders' summit in New Delhi, according to those familiar with the discussions, who spoke on condition of anonymity because the talks remain private.

Linking Systems, Not Merging Them

Rather than a unified network, India is proposing that BRICS countries connect their individual CBDC systems for cross-border transactions, an approach that could reduce reliance on commercial banks for certain transfers, lower transaction costs and speed up settlement times. India is also encouraging greater use of local currencies to settle bilateral trade in place of a third currency such as the dollar, extending a trend that has already gathered pace within the bloc, particularly in trade between Russia and its partners since Western sanctions cut several Russian banks off from the SWIFT payments network.

According to industry estimates, around 96% of India's trade with Russia is now conducted through rupee-rouble settlement mechanisms, while trade between Russia and China is settled almost entirely in yuan and roubles. India has separately signed local-currency trade agreements with central banks in the UAE, Mauritius, Maldives and Indonesia, with more such arrangements under negotiation.

Wary Of An Anti-Dollar Label

New Delhi's caution around a unified BRICS payments system reflects a broader concern about the bloc being cast as an explicitly anti-Western or anti-dollar grouping, a framing Indian officials have consistently sought to avoid even as they pursue de-dollarisation at the margins. India's Ministry of External Affairs has declined to detail the substance of ongoing Finance Ministers and Central Bank Governors discussions, which began earlier this week, and has urged patience ahead of an eventual joint statement from the summit.

Building On Existing Payment Links

The push for CBDC interoperability builds on payment integration India has already pursued outside the BRICS framework, including the recent linking of its Unified Payments Interface with Singapore's PayNow system for cross-border remittances. Speaking at an event in Mumbai this week, Modi indicated that such links should be extended to more countries with large Indian diaspora populations.

Economists note that greater local-currency and CBDC-based settlement could offer meaningful benefits for import-dependent economies like India's. Settling routine trade in local currencies can help conserve scarce dollar reserves for strategic imports, while offering a buffer against volatile global capital flows, according to analysts tracking the region. India already has its own digital rupee in pilot testing, alongside parallel CBDC experiments under way in China and Russia.

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