dollar vs rupees, the dominance of dollar is getting challenged, what should India do between dollar and challenger? – what will india do between dollar and its challengers
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Now the question arises that if there is a possibility of such a big change in the currency system of the world, then what stand should India take? Should it rely on the old strength of the dollar because of its economic closeness to the US in recent years? Or should we support the BRICS initiative, on which China also stands along with India.
How much is expected Sullivan served on the White House Economic Advisory Council during Trump’s administration. His doubts cannot be said to be completely unfounded. BRICS countries are also considering that there should be a new currency for foreign trade. It is being said that this idea can also take shape in August this year, because then the annual conference of BRICS is to be held. According to a report quoting a Russian politician, BRICS countries are developing a new payment system. Of course, this will not give protection to the dollar or the euro.
Whose idea is it: The issue of BRICS currency was first put forth by Russia because it is facing sanctions from western countries after the Ukraine war. There have been allegations since a long time that America uses the dollar as a weapon. In protest against this, the business between Russia and China, standing on one platform, was decided to be done in Yuan. Some time ago, Brazil and China made an agreement, in which they decided to break ties with the dollar and pay for business in their own currency.
Turnover in Rupees: About 18 countries are ready to do business with India through rupees. Most of the business between Russia and India is also being done in rupees. The Reserve Bank of India has put in place a framework which will be applicable to any participating country wishing to trade with India in rupees. Another thing that is important for India is that it is trying to run a digital currency. This is likely to go a long way in establishing the rupee on the international platform.
advantages and disadvantages: There are both advantages and disadvantages to the reduced use of the dollar. This will reduce the risk of dependence on any one currency, the country’s own currency will be strengthened. We will be able to decide our independent policy on currency. If America ever imposed sanctions, it would be easily countered. But the journey of this change will be full of challenges. Instability can be faced for a short period of time.
where is the problem: The US is clearly an opponent of Russia and China, while it considers India a strategic ally and partner in the Indo-Pacific region. India also believes that Russia and China’s efforts to reduce the use of dollar are currently more ideological, less practical. The mobilization of BRICS to challenge the hegemony of the dollar did not find strong support in India. The recent military tension between India and China has also acted as a deadlock.
Will get help: If BRICS countries bring their own currency, then it will certainly prove helpful in providing stability to their economy in future. But freedom from dollar dependence cannot be achieved overnight. Shouldn’t even meet, because if events change rapidly, America’s reaction can also be surprising. It needs to be accomplished in a very balanced manner.
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