BRICS countries set to trade in digital currency: Big relief for small traders; Able to do business within BRICS countries without collatering anything

At the 18th BRICS Summit, India is preparing a pilot project to connect digital currencies (CBDCs). China and Russia will be its co-pilot. This is aimed at reducing the dependence on a third currency like US Dollar in commercial payments in BRICS countries. No new common currency will be issued. The summit is going to be held from September 11 to 13 at Bharat Mandapam in New Delhi. Digital currencies like India's digital rupee, China's digital yuan and Russia's digital ruble will be linked to a common cross-border payment system. At the same time, existing national payment systems like India's UPI, China's CIPS and Russia's SPFS will also be linked. This will retain control over the country's own currency and central bank. What will India gain from this? Currency conversion, banking charges and settlement times will be reduced. Trade in local currencies between India and Russia is already growing. After the expansion of BRICS, new countries like Indonesia, Iran and UAE have also joined this grouping. This arrangement will immensely benefit Indian importers and exporters, with a share of 40% in the global economy. India has also taken inputs from other international experiments such as Project Ambridge, Project Aber, and Project Dunbar for this model. Consensus reached on 'BRICS Invoice Discounting Mechanism' study in Jaipur Small exporters do not get bank loans due to lack of guarantees (collateral) such as land or property despite receiving foreign orders. To solve this problem, BRICS countries have taken a new step. In the meeting held in Jaipur, a consensus has been reached on the study of 'BRICS Invoice Discounting Mechanism'. Under this scheme, small traders will get loans based on cash flow and business capacity rather than their assets. For example, if an Indian trader has sold goods abroad and the payment is due after three months, he can immediately get working capital by keeping an invoice with the bank. The 'TReDS' platform is already operational in India. Due to this successful experience, India will play an important role in this scheme. With the implementation of this new system, a major barrier to foreign trade for Indian MSMEs will be removed. India is chairing the BRICS summit BRICS is a group of major emerging economies of the world. It includes Egypt, Iran, Ethiopia, UAE and Indonesia along with India, Russia, China, Brazil and South Africa. Initially, it consisted of 4 countries, which were called BRIC. This name was given by Goldman Sachs economist Jim O'Neill in 2001. This year, India holds the reins of BRICS. Under India's chairmanship, meetings in different cities, Ministerial Conferences and multi-level discussions are taking place throughout the year. India's focus is on strengthening the Voice of the Global South, economic cooperation, energy security, digital technology, countering terrorism, and strengthening supply chains. This means that there is an effort to advance BRICS not just as a political platform, but as a big platform for trade, investment and development.