Critically evaluate the role of BRICS in challenging the hegemony of the US dollar in international trade. How can India balance its strategic interests within the bloc while maintaining strong ties with the US.
Kartavya Desk Staff
Topic: Effect of policies and politics of developed and developing countries on India’s interests,
Topic: Effect of policies and politics of developed and developing countries on India’s interests,
Q4. Critically evaluate the role of BRICS in challenging the hegemony of the US dollar in international trade. How can India balance its strategic interests within the bloc while maintaining strong ties with the US. (15 M)
Difficulty Level: Medium
Reference: IE
Why the question Perceiving growing attempts as a threat to the US dollar’s domination, US President-elect has threatened BRICS nations with 100 per cent tariffs if they create a new BRICS currency or back any other currency to replace the US dollar as the world’s reserve currency. Key Demand of the Question Analyze BRICS’ initiatives to challenge US dollar hegemony, identify challenges to this effort, and suggest ways for India to balance its interests between BRICS and the US. Structure of the Answer Introduction Briefly explain the dominance of the US dollar in international trade and the significance of BRICS’ efforts to create financial alternatives. Body Role of BRICS in challenging dollar hegemony: Highlight BRICS’ initiatives like alternative currencies, local trade mechanisms, and digital platforms. Challenges for BRICS: Discuss issues like economic asymmetry, geopolitical tensions, and resistance from the global system. India’s balancing strategy: Suggest ways for India to leverage BRICS initiatives while maintaining strong ties with the US. Conclusion Emphasize the importance of a multipolar financial system and India’s need to balance its economic sovereignty with its geopolitical partnerships.
Why the question Perceiving growing attempts as a threat to the US dollar’s domination, US President-elect has threatened BRICS nations with 100 per cent tariffs if they create a new BRICS currency or back any other currency to replace the US dollar as the world’s reserve currency.
Key Demand of the Question Analyze BRICS’ initiatives to challenge US dollar hegemony, identify challenges to this effort, and suggest ways for India to balance its interests between BRICS and the US.
Structure of the Answer
Introduction Briefly explain the dominance of the US dollar in international trade and the significance of BRICS’ efforts to create financial alternatives.
• Role of BRICS in challenging dollar hegemony: Highlight BRICS’ initiatives like alternative currencies, local trade mechanisms, and digital platforms.
• Challenges for BRICS: Discuss issues like economic asymmetry, geopolitical tensions, and resistance from the global system.
• India’s balancing strategy: Suggest ways for India to leverage BRICS initiatives while maintaining strong ties with the US.
Conclusion Emphasize the importance of a multipolar financial system and India’s need to balance its economic sovereignty with its geopolitical partnerships.