U.S. tariffs under President Donald Trump and India’s push within Brazil, Russia, India, China and South Africa (BRICS) countries for de-dollarization are both highly strategic and effective in their own ways.
The U.S.’s decision to impose steep tariffs (25% + additional 25% penalty tied to India’s continued Russian oil imports) on India under Section 232 (national security concerns) and Section 301 (unfair trade practices) which are illegal under the US law as these are not approved by the US senate.
The products like steel and aluminium were mainly targeted. The move strained trade relations and marked a shift away from the previously growing U.S.-India strategic partnership.
India and the U.S. completed five rounds of negotiations on a proposed Bilateral Trade Agreement (BTA).
Both sides remain at odds—primarily because India refuses to open its agriculture and dairy sectors, citing the need to protect its farmers. The sixth round, scheduled for August 25–29, 2025, in New Delhi with a delegation led by Assistant U.S. Trade Representative Brendan Lynch, was postponed for the time being because of intensifying trade disputes, particularly related to tariffs and India’s energy ties and also due to breakdown in U.S.–Russia negotiations held at Alaska on 15 August or a failed ceasefire initiative on Prussia – Ukraine war.
India’s push for de-dollarisation via BRICS can be seen as a befitting long-term strategic reply to U.S. trade aggression like Trump’s tariffs. Rather than reacting with more tariffs or protectionism, India is advocating for systemic economic sovereignty, with deeper and more sustainable countermeasures.
BRICS nations have increased their strength by inducting full and partner countries membership.
The full member countries inducted officially are Egypt, Ethiopia, Iran, and the United Arab Emirates (UAE) on January 1, 2024. Indonesia joined as a full 10th member on January 6, 2025. BRICS also created a partner-country status—an intermediary category allowing countries to participate without having full member rights. As of mid‑2025, the partner countries include – Belarus, Bolivia, Cuba, Kazakhstan, Malaysia, Thailand, Uganda, Uzbekistan, and Nigeria. Additionally, Vietnam joined as a partner country in June 2025.
BRICS Data (2025 update) estimates that, with the six new members, BRICS’ share of global GDP (PPP) reached approximately 39% in 2023. A report from BRICS Brasil based on IMF data shows that BRICS accounted for 40% of the global economy (PPP) in 2024, with a projection rising to 41% in 2025. On a PPP basis, the bloc commands 36–41% of global economic output, according to different sources and methodologies.
Prime Minister Modi has, in recent BRICS summits, encouraged member nations to trade in their respective local currencies. This aligns with broader BRICS de-dollarisation efforts, especially as Russia and China are actively reducing dependence on the U.S. dollar. India has already initiated
rupee trade settlements with countries like Russia and the UAE. This step can reduce currency volatility risks, improve bilateral trade efficiency and undermine the dollar’s global dominance, especially for the Global South.
India has quietly ditched US Dollar by sending a circular to BRICS granting full Rupee access. India’s Reserve Bank of India has opened the door for BRICS and other partner countries to settle trade fully in rupees, no longer forcing them to use Dollar as the default settlement currency. India has shown some mettle and have bitten the bullet.
Tariffs are short-term economic weapons. De-dollarisation is a strategic rebalancing of global financial power. By pushing BRICS toward non-dollar trade, Modi is signalling India’s willingness to lead in building an alternative financial architecture—one less vulnerable to U.S. unilateralism like sanctions or tariffs.
Trump’s reaction to de-dollarisation—especially moves by BRICS and India—would likely to be assertive, defensive, and transactional. Based on his track record and public statements, what we can reasonably expect – diplomatic pressure and threats of retaliation. Trump is likely to view de-dollarisation as a direct threat to U.S. economic dominance. His administration could apply bilateral pressure on countries (especially India) to discourage trade in non-dollar currencies.
Trump may use sanctions, tariffs, or trade restrictions on nations accelerating de-dollarisation (as seen with Iran, Russia, and China previously). He may push back against currency swap agreements or non-dollar oil trades, which he would perceive as undermining U.S. leverage.
Under Trump, the U.S. might tighten control over the SWIFT system, pressure global banks, and threaten secondary sanctions. Countries trading in local currencies (like India-Russia Rupee-Rouble deals) could be labelled as “sanctions evasion” tactics. U.S. firms and banks may face penalties if they engage with entities conducting large-scale non-dollar trade.
He may impose more tariffs on imports from countries seen as economically aligning against the U.S. and push to repatriate American manufacturing and reduce economic interdependence with BRICS members.
