India to push BRICS digital currency link

India, the current chair of BRICS, aims to link its country's official digital currencies (CBDCs) with those of the other BRICS nations at an upcoming summit in New Delhi on September 12-13. This proposal, reported by Reuters in January, hopes to facilitate cross-border trade. The BRICS group consists of Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Indonesia, Iran, Saudi Arabia, and the United Arab Emirates.

The RBI suggested linking digital currencies to streamline cross-border transactions, but the plan faces challenges due to the limited global adoption of digital currencies and political complexities. Previous attempts at creating shared payment mechanisms within BRICS have not been successful. Tensions among members, such as Iran and the UAE, could hinder progress.

Also, India's reluctance to deepen financial ties with China due to national security concerns could further complicate matters. The proposal will be part of the leaders' meeting agenda, but the adoption of digital currencies globally is still not widespread enough. BRICS, formed in 2009, aimed to provide a platform for major emerging economies to gain more influence in institutions dominated by Western powers, though its expansion has become a constraint in recent times.