Leaders from BRICS – a group of 10 major emerging nations including Brazil, Russia, India, China, and South Africa – met in Brazil’s Rio de Janeiro on 06-07 July 2025 amid tariff threats from the US and geopolitical challenges. This was the first meeting of the expanded group that now includes Egypt, Ethiopia, Iran, Indonesia, and the UAE. Saudi Arabia is still considering whether to join.
On Day 1, the Group condemned sanctions, unilateral tariffs and strikes on Iran. During the Summit, several resolutions on counterterrorism, energy security, climate change and re-ordering of WTO were agreed. India will host the next BRICS summit.
President Trump, accusing the group pf being anti-American, threatened to add an10% tariffs on nations aligning themselves with BRICS. Few days later, he imposed 50% tariffs on Brazil. President Lula has vowed to retaliate.
Non-Western or Anti-Western?
Some western analysts see the group as a potential rival to G-7. They portray BRICS as attempting to challenge the dominance of US-led political and economic order and the strong dominance of the US dollar. Chinese spokesperson clarified said BRICS does not engage in bloc confrontation or target any country.
BRICS nations want to diversify away from the risk of excessive reliance on the US dollar in international trade and finance. There have been substantive discussions on promoting the use of local currencies in bilateral and multilateral trade and investment, developing alternate payment systems, and diversifying foreign exchange reserves. These nations would like to reduce vulnerability to US monetary policy and economic sanctions.
Two things are clear. Firstly, threats to US dollar or attempts to “de-dollarize” are overstated. Dollar remains the dominant global reserve currency, with deep and liquid financial markets, making it difficult to replace. Secondly, for BRICS, it is less about changing the global order and more about having a say in the political and economic order, though there is disagreement about what shape the new order would take.
The shadow of China, $18 trillion economy looms large over the group. BRICS nations promote complementarity of economies. Currently, all BRICS nations trade with China, but trade among other members is limited.
In theory, the group has the clout to push through reforms of global governance. BRICS nations make up half of global population, 40% of global GDP (US$29 trillion) and 25% of global trade.
In practice, BRICS has limitations. Trade among BRICS nations is a fraction of that between the US and the EU. BRICS countries have diverse political and economic structures and priorities. India and China have major political differences. India is looking at its own trade deal with the US. The absence of Chinese President Xi Jinping and the virtual participation of Russian President Vladimir Putin at the 17thBRICS Summit underscored internal challenges.
Ref: Indian Express and Al Jazeera.