Context

• The 18th BRICS Summit, hosted by India in New Delhi on September 12–13, 2026, under the banner Humanity First, offers an opportunity to examine the bloc’s ambition to reshape global finance.
• BRICS seeks to challenge western dominance, reduce dependence on the U.S. dollar and create institutions that better represent developing countries.
• However, seventeen years of cooperation reveal a gap between its political rhetoric and institutional performance.
• The New Development Bank (NDB), Contingent Reserve Arrangement (CRA) and de-dollarisation agenda have not produced a genuinely independent financial architecture.

BRICS and the Quest for Financial Independence

• BRICS emerged from dissatisfaction with the unequal distribution of power in the World Bank and IMF.
• Developing countries have criticised their Western-oriented governance and financial conditions.
• The bloc responded by establishing alternative institutions and promoting local currencies to strengthen the bargaining power of emerging economies.
• Yet, genuine independence requires institutions capable of operating outside the financial structures they challenge.

The New Development Bank: An Incomplete Alternative

• Dependence on the Existing Financial System
  • The bank’s record demonstrates significant limitations. Approximately 50% of its outstanding bonds are denominated in U.S. dollars, while the Chinese yuan accounts for most of the remainder.
  • The South African rand represents only 1%. Local-currency lending stood at roughly 22% by mid-2025, below the 30% target for 2026.
  • The delayed development of a rupee-denominated bond further illustrates the difficulty of achieving financial independence.
  • The NDB also relies on Western credit-rating agencies, including S&P, Fitch and Moody’s.
  • In March 2022, it suspended operations related to Russia to protect its credit standing, revealing the influence of external financial discipline.
• Scale and Institutional Limitations
  • The NDB approved projects worth approximately $39 billion by the end of 2024, compared with around $100 billion committed annually by the World Bank Group.
  • Its co-financing with established institutions suggests that it functions as a complementary institution rather than a direct competitor.

The Contingent Reserve Arrangement: A Safety Net Without Independence

• The CRA has never been activated. Members seeking more than 30% of their allotted share must first enter into an IMF programme.
• This condition undermines its purpose of reducing dependence on the IMF.
• The absence of permanent staff, independent surveillance and a research wing further limits its effectiveness.
• The CRA therefore represents a significant political aspiration but an underdeveloped crisis-management mechanism.

De-dollarisation: Rhetoric Versus Reality

• Divergent National Interests
  • India opposes a common BRICS currency because of potential U.S. trade reprisals.
  • South Africa considers it risky, while China favours gradual yuan internationalisation. Russia has stated that BRICS has not sought to abandon the dollar.
  • The absence of de-dollarisation from the 126-point Rio declaration of 2025 reflects the bloc’s cautious official position.
  • Divergent national interests prevent BRICS from adopting a unified monetary strategy.
• The Dollar’s Continuing Influence
  • BRICS countries remain dependent on dollar-based financing and global capital markets.
  • The reported threat of additional U.S. tariffs against countries pursuing anti-American BRICS policies further demonstrated Washington’s economic influence.
  • The bloc’s lack of a collective response exposed the limits of its willingness to challenge the existing monetary order.

Reforming the IMF or Replacing It?

• BRICS declarations at the Kazan summit in 2024 and Rio summit in 2025 called for a quota-based and adequately resourced IMF.
• This seeks greater representation within the existing system rather than its replacement.
• The United States holds 16.49% of IMF voting rights, while major decisions require an 85% supermajority, giving Washington an effective veto.
• BRICS countries seek greater influence but have not demonstrated a willingness to bypass these arrangements.
• Their objective may therefore be a stronger position within the existing financial order.

India’s Leadership and the Future of BRICS

• India’s 2026 summit provides an opportunity to reassess BRICS priorities.
• Its expansion to Egypt, Ethiopia, Iran and the UAE indicates genuine interest in a more representative global order.
• However, expansion alone cannot guarantee effectiveness.
• BRICS must strengthen local-currency financing, improve the CRA’s independence and develop practical mechanisms for reducing financial vulnerabilities.
• India can promote a realistic agenda focused on financial inclusion, infrastructure and global governance reform.

Conclusion

• BRICS has successfully brought together emerging economies and challenged the legitimacy of Western dominance.
• Yet, BRICS has not created an independent global financial architecture. The NDB remains tied to dollar financing and Western credit-rating agencies, while the CRA depends on IMF-linked conditions.
• The central challenge is whether BRICS members are willing to accept the costs of genuine institutional independence.
• Until then, BRICS will remain more a platform for negotiating a better position within the existing global order than for replacing it.