The Reserve Bank of India’s proposal to explore linkages between the central bank digital currencies of BRICS members strips the de-dollarisation debate of drama and places it where it belongs: in the realm of risk management.
The RBI’s idea is limited and technical. It involves studying whether interoperable CBDC arrangements could be used for cross-border payments — initially for trade settlement, remittances and tourism — allowing transactions to be settled directly in national digital currencies. The potential benefits are familiar: lower transaction costs, faster settlement and reduced reliance on dollar-based correspondent banking networks and messaging systems such as SWIFT. The central bank has been explicit that this is about efficiency and resilience, not about challenging dollar dominance.
That framing matters, but it does not make the proposal apolitical. Payments infrastructure determines who bears risk when geopolitics intrudes into finance. Over the past decade, and more sharply since the Ukraine war, financial systems have been weaponised. Sanctions have expanded in scope and frequency. Sovereign reserves have been frozen. Under Donald Trump, tariffs and trade access have been deployed bluntly as instruments of pressure. Dependence on a single
currency and a single payments architecture is thus no longer a neutral economic choice.
The RBI proposal reflects this reassessment. It does not assume the dollar is about to collapse; it assumes that over-reliance on it carries costs. A BRICS-level CBDC linkage would not displace the dollar from global trade or finance. But it could make dollar intermediation less automatic in specific transactions and corridors.
India’s caution is informed by experience. Previous attempts to expand local-currency trade have exposed structural problems. Digital settlement does not solve this; it can intensify imbalances unless backed by swap lines, clearing mechanisms or agreed net settlement frameworks. Beyond that lie difficult questions of interoperability among CBDC designs, governance rules, data localisation, privacy standards and anti-money-laundering compliance. These are not marginal issues. They explain why the RBI has kept the proposal exploratory rather than declaratory. They also explain India’s preference for decentralised arrangements over grand designs. New Delhi has kept its distance from calls for a common BRICS currency and from tightly integrated multi-CBDC platforms.
The concern is straightforward: replacing dollar dependence with another form of dependence serves little purpose.
This pragmatism cuts through much of the rhetoric that surrounds BRICS. The grouping is not positioned to launch a shared currency, nor is there consensus for one. What BRICS is actually doing is quieter and more realistic: expanding local-currency settlements, experimenting with alternative payment rails, and building digital infrastructure that reduces vulnerability to unilateral financial actions.
The RBI’s CBDC proposal fits squarely within this trajectory. It is about ensuring continuity of trade and payments under adverse conditions, not about signalling monetary rebellion. That distinction explains the language used — technical, measured and deliberately unspectacular. It also explains the sensitivity around timing and messaging. The United States of America has made clear its discomfort with initiatives that appear to dilute dollar centrality and Trump has warned of punitive responses.
Global trends support this reading. Regional payment arrangements are expanding without fanfare. CBDCs, in this context, are not revolutionary technologies but instruments for reclaiming control over financial infrastructure.
The forthcoming BRICS summit, expected in August or September, may provide a platform for these ideas to be discussed, but any reference to the RBI proposal is likely to be cautious. If raised, it will be framed as a technical exploration. There will be
no declarations of monetary realignment, because none is intended.
R. Suryamurthy is an economic analyst