A BRICS Giant Rejects Dedollarization And Defends The US Dollar

The question of dedollarization is shaking major economic powers. While the BRICS are seeking alternatives to the US dollar for their international exchanges, India is taking a different path. The Minister of External Affairs, Subrahmanyam Jaishankar, clarified the country’s position during a visit to the United Kingdom: “India does not intend to replace the dollar as the reference currency.” A statement that stands in contrast to the global trend and raises questions about New Delhi’s strategic motivations.

A firm support for the dollar despite the trend towards diversification

During his recent intervention, Subrahmanyam Jaishankar sought to dispel any ambiguity about India’s position regarding the dollar: “there is no policy on our part aimed at replacing the dollar. At the end of the day, the dollar as a reserve currency is a source of international economic stability.”

This is a clear stance at a time when several major economies are looking to reduce their dependence on the US currency.

Despite its membership in the BRICS, India does not follow the hardline position of some of its partners on monetary issues.

Contrary to the perception of a united front within the organization, the Minister clarified that “there is no unified position of the BRICS against the dollar.” Thus, each country pursues its own interests, and New Delhi favors an approach that enhances financial stability and foreign investments rather than an economic confrontation with the United States.

The maintenance of the dollar as a reference currency can be explained by several reasons:

• An international financial stability: the dollar remains the main reserve currency and its maintenance avoids economic shocks.
• Major trade and investment flows in dollars: a large part of India’s foreign trade is denominated in dollars, making any substitution risky.
• The weight of strategic relations with the United States: through strengthening its economic ties with Washington, India secures trade agreements and international financing.
• A mistrust of a still uncertain BRICS alternative: contrary to some expectations, the BRICS have not adopted a coordinated position on dedollarization, leaving room for individual strategies.

Far from committing to a sudden break with the dollar, India is therefore seeking to preserve its economic interests and pursue the diversification of its monetary tools.

A dual strategy: internationalizing the rupee without challenging the dollar

If India does not challenge the dollar’s hegemony, it is making efforts to internationalize its own currency. Jaishankar highlighted this ambition:

We are clearly promoting the internationalization of the rupee, as we are actively globalizing India.

This will is reflected in the development of trade agreements that allow settlements in rupees, particularly with countries struggling to access hard currencies.

Such dynamics are manifested in the establishment of direct payment mechanisms in rupees with several economic partners. The goal is twofold: to reduce dependence on dollar fluctuations and to strengthen the monetary sovereignty of the country.

However, this approach remains complementary, and not opposed, to the use of the dollar in international exchanges.

At the same time, India remains pragmatic in the face of global monetary tensions. US threats of economic sanctions against countries engaged in a dedollarization policy have led some states to adopt a more cautious posture.

Donald Trump, for example, has already mentioned tariffs of up to 150% on nations that seek to move away from the dollar. Rather than entering into confrontation, India adopts a strategic approach aimed at preserving its economic interests and consolidating its ties with Washington.

This choice of a hybrid strategy reflects a desire to adapt to the changes in the global financial system. By consolidating the position of the rupee on the international stage and preserving the dollar as the pivot of its monetary policy, India seeks to position itself as a central player in a multipolar world. This pragmatism allows it to avoid economic turbulence related to a too abrupt turnaround while preparing its economy for future transformations. With this posture, India does not merely follow a guiding line dictated by the BRICS or the United States. It shapes its own economic and monetary trajectory.