India, Jan 19 : India’s Reserve Bank has proposed linking the central bank digital currencies (CBDCs) of BRICS nations to facilitate smoother cross border trade and tourism payments, potentially reducing dependence on the U.S. dollar, according to two sources familiar with the matter.
The RBI has reportedly recommended to the Indian government that this proposal be included on the agenda for the upcoming 2026 BRICS summit, which India will host later this year. If approved, it would mark the first formal push to integrate the digital currencies of BRICS members Brazil, Russia, India, China, and South Africa for international settlements.
The initiative builds on a 2025 BRICS declaration in Rio de Janeiro advocating for interoperable payment systems to make cross border transactions more efficient. While none of the main BRICS members have fully launched their CBDCs, pilot programs are already underway. India’s e-rupee, launched in December 2022, has attracted over seven million retail users, while China continues to promote the international use of its digital yuan.
The proposed linkage will require consensus on technology standards, governance rules, and methods to address trade imbalances. One approach being considered is bilateral foreign exchange swap arrangements between central banks, allowing settlement of imbalanced trade volumes either weekly or monthly. Previous attempts to trade in local currencies, such as between India and Russia, had faced challenges due to limited utility of accumulated balances.
The RBI emphasized that while the linkage may reduce reliance on the U.S. dollar, the move is primarily aimed at improving cross-border payment efficiency rather than pursuing outright de-dollarisation.
India’s push comes amid heightened geopolitical tensions and global trade frictions. With the BRICS bloc expanding to include countries such as the UAE, Iran, and Indonesia, the digital currency initiative could strengthen financial cooperation and further the bloc’s economic influence.
RBI Deputy Governor T. Rabi Sankar noted the advantages of CBDCs over stablecoins, highlighting that CBDCs are safer, more regulated, and less prone to risks affecting monetary stability, banking intermediation, and fiscal policy. India sees linking BRICS digital currencies as a way to bolster its domestic digital payments ecosystem while facilitating global trade.