- India and the UAE ink landmark deals bypassing the US dollar: a 1 million barrel oil deal and a significant gold transaction, both in Indian rupees.
- These transactions align with the BRICS bloc’s vision for promoting local currencies over the US dollar in global trades.
BRICS Vision in Action: The Rupee Takes Center Stage
As the BRICS alliance expands its influence with six new country members, a significant shift is evident in the global trade dynamics. India and the United Arab Emirates (UAE) stand as trailblazers in this transformation, orchestrating two monumental deals devoid of the traditional US dollar anchor.
The Transcendent Transactions
India and the UAE have consummated a remarkable agreement – a 1 million barrel oil transaction conducted entirely in Indian rupees. This deal’s sheer scale underscores the growing confidence and autonomy of nations within the BRICS bloc. Further emphasizing this evolving paradigm, another transaction saw the UAE exporting 25kg of gold to India, fetching a whopping 128.4 million rupees, translating to a robust $1.54 million.
As this wave of change cascades, it’s vital to understand the backdrop. The BRICS nations, following their recent expansion, have vigorously championed the cause of de-dollarization. Their objective is lucid: to reduce the global trade reliance on the US dollar and bolster the stature of local currencies.
Validating this vision, the significant oil deal between India and the UAE in August took place in rupees, with Indian Oil Corp. purchasing oil from Abu Dhabi National Oil Company. Interestingly, this deal didn’t involve the US.
Furthermore, these nations’ burgeoning ties were further cemented with another rupee-based transaction worth over 120 million rupees. This trade, pivoting around gold, interlinks with the ongoing discussions surrounding the emergent BRICS currency. Positioned as an alternative to the US dollar, this new currency, underpinned by gold, is poised to redefine the contours of international trade.
India’s proactive stance in these developments is noteworthy. The country’s central bank is said to have fashioned a novel global trade framework that would pivot on the rupee, diminishing the dominance of the US dollar. Such strategic shifts resonate with the broader aspiration of nations in the global south to detach from Western sway, particularly by sidelining the traditionally dominant US dollar as the world’s primary reserve currency.
In the ever-evolving theatre of global trade and finance, such transactions aren’t mere isolated events. They signify a tectonic shift, underpinned by collaborative visions like that of the BRICS bloc, challenging and redefining established norms.