WHY DONALD TRUMP IS TARGETING BRICS?
Introduction: What is the issue?
- At the 17th BRICS Summit held in Rio de Janeiro (July 2025), U.S. President Donald Trump threatened to impose a 10% tariff on all countries aligned with the BRICS grouping.
- This move marks a sharp escalation in U.S. trade policy and reflects Trump’s larger geopolitical objective: to counter what he sees as an emerging anti-American coalition challenging U.S. economic dominance, especially the hegemony of the U.S. dollar.
ABOUT BRICS
| Aspect | Details |
| Founded | 2009 (originally BRIC); South Africa joined in 2010 |
| Members (2025) | Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Iran, Indonesia, UAE |
| Global Share (2025) | 25% of global GDP ($28 trillion); 45% of world population |
| Recent Developments | Proposed BRICS Payment System, growing calls for use of local currencies in trade |
| Strategic Goal | Promote multipolarity, enhance Global South cooperation, reduce Western dependency |
THE REASONS
A. De-Dollarisation Efforts
Trump sees BRICS as threatening the U.S. dollar’s global reserve status, which underpins American global influence.
Key reasons for his concern:
- Proposals for a BRICS common currency to settle trade and reduce dollar reliance.
- Cross-Border Payments Initiative (CBPI):
- Developed by the BRICS Payment Task Force.
- Aims to facilitate intra-BRICS trade through local currencies and interoperability of national systems.
- Accelerated after Western sanctions on Russia disrupted international payments.
- Statements from BRICS summits (2023 in South Africa, 2024 in Russia) promoted alternative payment systems.
Though no concrete currency has been adopted, the political signaling is what Trump sees as a direct challenge.
B. Political Distrust and Anti-Western Alignment
Trump has repeatedly referred to BRICS as:
- “Anti-American”
- “A platform for China and Russia to build a new global system”
The inclusion of Iran and Russia, both sanctioned by the U.S., fuels American fears of a parallel economic order emerging outside U.S. control.
ACTIONS TAKEN OR PROPOSED BY USA
| Measure | Target | Justification |
| 10% blanket tariff | All BRICS members | Announced July 6, 2025 — “for being in BRICS” |
| Earlier threat: 100% tariff | BRICS (Nov 2024) | If they move toward a BRICS currency |
| 50% tariff on Brazil | Brazil | Alleged political persecution of former President Bolsonaro |
| 30% tariff on South Africa | South Africa | Accusations of unfair trade; treatment of White minorities |
| Proposed 500% tariff | Russian oil/products | Under “Sanctioning Russia Act of 2025”; affects India and China as importers |
ADDITIONAL CONTEXT
- Trump’s “America First 2.0″ trade agenda includes plans for across-the-board reciprocal tariffs starting August 1, 2025.
- His focus is not just economic—but symbolic, aiming to dismantle alternative alliances that challenge U.S. unipolarity.
IS BRICS REALLY TRYING TO REPLACE US DOLLAR?
No, according to BRICS members:
- South Africa’s Foreign Ministry: Using local currencies in BRICS trade is not the same as replacing the U.S. dollar.
- BRICS Rio Declaration (July 2025):
- Paragraph 50: Encourages further discussion on payment interoperability, but avoids any anti-dollar language.
- Paragraph 13: Criticizes unilateral trade measures—but does not name the U.S..
Internal Differences:
- Not all BRICS members are aligned:
- India and Brazil are pursuing deeper trade ties with the U.S.
- India is not supportive of a new BRICS currency.
The Rio declaration was deliberately cautious, reflecting the lack of consensus within BRICS on a united economic front.
WHERE DOES INDIA STAND?
India’s Strategy: Caution and Balance
| Statement | Source | Position |
| Dec 2, 2024 | MoS Finance | Clarified that Russia’s proposal on alternate currency was “only noted”, not adopted |
| March 2025 | EAM S. Jaishankar | Asserted that “there is no Indian policy to replace the dollar” |
India continues to:
- Support financial cooperation within BRICS.
- Avoid direct confrontation with the U.S.
- Prioritize negotiations for a Free Trade Agreement with the U.S..
CONCLUSION
Trump’s attacks on BRICS stem from a desire to protect U.S. economic primacy and disrupt any attempts at forming alternative global economic systems. While BRICS has grown in ambition and membership, its internal divisions and lack of a unified policy on de-dollarisation mean it poses more of a potential threat than an actual one—at least for now. India, as both a BRICS member and a strategic partner of the U.S., will need to navigate this geopolitical fault line with skill, ensuring it retains autonomy while securing strategic benefits from both partnerships.
Note: Connect with Vajirao & Reddy Institute to keep yourself updated with latest UPSC Current Affairs in English.
Note: We upload Current Affairs Except Sunday.