As global trade undergoes structural shifts, the BRICS+ framework and the New Development Bank (NDB) are stepping up to reshape cross-border payments and financing. For Indian exporters, this evolution presents both opportunities and challenges — from reducing reliance on the US dollar to unlocking new trade corridors across emerging markets. Understanding these changes is essential to stay competitive in the 2024-25 export landscape.
The BRICS+ Shift in Global Trade
With the expansion of BRICS into BRICS+ (including economies such as Saudi Arabia, UAE, Egypt, and Iran), the bloc now represents 46% of the world’s population and nearly 36% of global GDP. This expansion strengthens its influence over global trade and finance. One of the major priorities of BRICS+ is to establish alternative payment and financing mechanisms that reduce dependence on the US dollar and Western-dominated systems like SWIFT.
For India, this realignment is significant. As one of the fastest-growing economies within the bloc, Indian exporters can benefit from easier access to new partner markets, reduced currency conversion costs, and financing support through the NDB.
The Role of the New Development Bank (NDB)
Established in 2015, the NDB has evolved into a crucial multilateral lender for BRICS countries and their partners. Its mission goes beyond infrastructure financing — the bank is now facilitating local-currency lending, trade finance, and cross-border settlement frameworks.
Recent initiatives include:
- Local-Currency Loans: The NDB is scaling up loans in Indian Rupees, Yuan, and other BRICS currencies to minimize forex risk for businesses.
- Cross-Border Settlement Platforms: Work is underway to create interoperable digital payment systems between BRICS+ nations, which could bypass reliance on SWIFT.
- Sustainable Export Financing: Exporters in sectors like renewable energy, infrastructure, and agritech can access concessional funding aligned with BRICS+ sustainability goals.
Implications for Indian Exporters
For Indian exporters, BRICS+ offers both diversification and resilience. Traditional markets in North America and Europe remain important, but exporters are increasingly exploring new demand centers in Africa, West Asia, and Latin America.
Key takeaways for exporters include:
- Reduced Dollar Dependency: Settling trade in local currencies can cut transaction costs and reduce exposure to US monetary policy volatility.
- New Buyer Markets: With BRICS+ partners like the UAE and Saudi Arabia deepening trade ties, sectors such as gems & jewellery, pharmaceuticals, IT services, and food exports stand to gain.
- Faster Settlement: Cross-border digital payment frameworks promise quicker remittance cycles, improving liquidity for exporters.
- Financing Access: NDB’s trade finance and project loans can help Indian firms scale operations into new BRICS+ regions with reduced risk.
Challenges & Risks
While promising, the BRICS+ cross-border payments agenda is still evolving. Exporters should remain aware of potential hurdles:
- Regulatory Differences: Each BRICS+ nation has unique foreign exchange and compliance frameworks that exporters must navigate.
- Technology Integration: Digital settlement platforms are in early stages; interoperability and cyber-security remain concerns.
- Liquidity of Local Currencies: While INR settlements are being promoted, hedging mechanisms for non-convertible currencies like the ruble or real may remain limited.
- Geopolitical Risks: Shifts in alliances or sanctions regimes could impact transaction flows in some regions.
Strategic Opportunities
Indian exporters should watch the following opportunity areas:
- Oil-Linked Trade: With BRICS+ energy giants like Saudi Arabia and Russia, exporters of engineering goods, IT services, and chemicals can link supply chains to energy-driven growth projects.
- Agriculture & Food Products: Rising demand in Africa and West Asia opens avenues for Indian staples, processed food, and agritech exports.
- Pharma & Healthcare: India’s strong generics and vaccine exports align with healthcare expansion in emerging BRICS+ economies.
- Digital & Green Technology: Collaboration in fintech, clean energy, and smart infrastructure is being prioritized under BRICS+ initiatives.
By strategically aligning with NDB financing and BRICS+ trade corridors, Indian exporters can diversify beyond traditional dependencies and build stronger, more resilient trade linkages.
How T&A Consulting Supports Exporters
At T&A Consulting, we help Indian businesses navigate the evolving landscape of cross-border trade. Our expertise spans market entry strategies, compliance navigation, trade financing advisory, and strategic partnerships.
Whether it’s understanding NDB’s local-currency lending programs, leveraging BRICS+ market opportunities, or mitigating regulatory risks, our team provides actionable insights for exporters to thrive.
Looking Ahead
The BRICS+ push for alternative cross-border payments and the growing role of the New Development Bank mark a turning point in global trade finance. For Indian exporters, these shifts bring the possibility of lower transaction costs, wider market access, and more secure financing pathways.
Contact us at: pnijhawan@taglobalgroup.com to explore how your export business can align with BRICS+ opportunities and the NDB framework for growth in 2024-25.
Sources: New Development Bank, RBI, UNCTAD, Financial Express, LiveMint.