India joins SCO’s plan to counter US financial clout

India has joined the Shanghai Cooperation Organisation (SCO) in discussions to establish a new financial institution aimed at countering US financial influence, according to sources familiar with the matter. This development bank, to be created during ongoing negotiations, has the backing of all member states at the SCO's recent summit in Bishkek, Kyrgyzstan.

The SCO member states are currently working on the bank's governance structure and capital allocation. Finance Minister Nirmala Sitharaman met with her Russian counterpart Anton Siluanov on the sidelines of the G20 Finance Ministers' meeting in the US, discussing the initiative. The Bishkek Summit declaration emphasized the need to finalize the founding documents promptly.

Russian President Vladimir Putin proposed the establishment of an independent development bank during the SCO summit, stating it should not be dependent on financial systems used by countries to gain economic and geopolitical advantages. Putin highlighted the potential for the bank to finance joint projects and strengthen economic ties among SCO members, noting Russia's significant trade with the organization — over $400 billion last year.

Kazakhstan, the largest economy in Central Asia, has also expressed interest in hosting the new bank, with President Kassym-Jomart Tokayev offering to provide the necessary infrastructure and headquarters if consensus is reached among the member states.