Indian Prime Minister Narendra Modi is set to open a BRICS summit in New Delhi, grappling with the challenge of building consensus among member states as an escalating war in the Middle East threatens to create further divisions. Chinese leader Xi Jinping arrived in the Indian capital on Saturday, joining other BRICS leaders including Russia's Vladimir Putin and Iran's Masoud Pezeshkian. Their arrival followed Saudi Arabia's closure of a crucial alternative pipeline to the Strait of Hormuz due to multiple attacks from Iran-backed militants, underscoring the regional instability.
The summit is taking place against a backdrop of increasing global pressures, including US tariffs, sanctions, and the ongoing war between the US and Israel with Iran. These factors are compelling several BRICS members to explore diversification of their trade and payment relationships. Donald Trump's trade policies have disrupted international relations, and the US continues to exert economic pressure on Russia and Iran. Despite differing motivations, these pressures are encouraging cooperation among BRICS nations on trade, energy, and payments, even though deep divisions exist among them.
Negotiations for a joint statement were complex, extending into the early hours of Saturday to secure agreement among diverse countries like Iran, Saudi Arabia, and the United Arab Emirates. The BRICS group, which has expanded to include nations such as Iran, Egypt, Ethiopia, the UAE, and Indonesia, now carries greater economic and geopolitical weight, but this expansion also complicates the process of achieving consensus. The summit will highlight the extent to which these external pressures can drive cooperation, particularly regarding alternative channels for trade and payments, despite varying degrees of willingness among members to reduce dependence on the US dollar. India, for instance, advocates for increasing trade in local currencies and digital payments to cut cross-border transaction costs, rather than a broad de-dollarization push.
