India Is Chairing the Dollar's Funeral. Or Is It?

Grant: Welcome to Outside In. I'm here with Miles, and this week the story starts in New Delhi. Miles: India holds the BRICS chair in twenty twenty six, Grant: Mm hmm. Miles: September summit New Delhi September twelfth (de-dollarization front and center). Grant: And then two days ago, Rubio lands in New Delhi and calls a US-India trade deal "on the verge"--same week, same minister. Miles: Jaishankar has already said publicly India has no policy to replace the dollar. Colorized, he's chairing a block whose whole pitch is doing exactly that. Grant: That tension is where we start. Is India hedging or is it quietly gutting the BRICS agenda from the inside? Miles: Then we get into the plumbing. BRICS Pay is targeting the New Delhi summit for full deployment. Grant: According to Riotimesonline, it's a decentralized connector linking Russia's SPFS, China's CIPS, India's UPI. And Brazil's Pix not a new currency, not a central clearing house. Miles: The architecture is real-whether its operational by September is a different question. Grant: And there's a settlement layer underneath all of this: the Unit-a gold anchored wholesale pilot launched Halloween, twenty twenty five-one hundred units issued, each pegged to one gram of gold. Miles: Forty per cent gold, sixty per cent BRICS currency basket. We'll break down what gold-backed actually means here, because the framing in most coverage is loose. Grant: We'll also look at what any of this means on the ground-Nigeria, Vietnam, Argentina-countries with real dollar dependency costs and a BRICS alternative that isn't ready for daily trade yet. Miles: And we close by flagging three signals to watch before and after New Delhi, the ones that will tell you whether the summit actually moved anything. Grant: Let's get into it. India is hosting the BRICS summit in September. They hold the 2026 presidency. Their official agenda is built around reducing dollar dependency. Miles: And two days ago, Rubio flew to New Delhi and stood next to Jaishankar, saying the U.S.-India trade deal is on the verge of happening. Grant: That's the contradiction we're opening on, the country running BRICS just publicly embraced the dollar. Miles: Back in February, according to Investing News Network, India broke ranks with its BRICS peers. signed a trade deal with Washington Grant: Mm Miles: agreed Grant: -hmm. Miles: to stop buying Russian oil. Grant: In exchange for U.S. tariffs dropping from 50% down to 18% on a broad range of goods. Miles: That's a real number. India was facing 50% tariffs. That's not symbolic pressure. That's economic pain. Grant: And Jaishankar wasn't quiet about it. He said explicitly, Briefs.co reported this, I don't think there's any policy on our part to replace the dollar. The dollar as the reserve currency is the source of global economic stability. Miles: He said that in London, March twenty twenty five, and nobody made much of it at the time. Grant: Now he's saying it again next to Rubio in New Delhi two days before this episode. Miles: So here's my problem with framing this as a betrayal: BRICS doesn't have a unified position on de-dollarization. Jaishankar said that too. Grant: Right. Russia confirmed in January twenty twenty six that talks on a So on a common currency have not taken place, and are not taking place now." That's from Riotimesonline dot co. Miles: So India isn't breaking from a consensus; there is no consensus. Grant: What India is doing is running a hedge. Nearly ninety five per cent of India-Russia trade is now settled in national currencies per Riotimesonline's April update. That's not dollar dependency. Miles: But they're also cutting Russian oil purchases to get tariff relief from Washington. Both things at the same time. Grant: That's the key insight here: India isn't choosing sides-India is keeping every door open. Miles: Which matters because they're also the host of the September twelfth summit in New Delhi-the country chairing the meeting is the one most publicly distancing itself from the meeting's agenda. Grant: Same posture France held at Evian, honestly-different issue, same dynamic. Miles: Right. Chair the room, don't commit to the room. Grant: So the question this raises If India is publicly walking back de-dollarization rhetoric while simultaneously hosting a summit where BRICS is supposed to debut new financial infrastructure, what does that infrastructure actually look like? And does it matter what India says publicly if the plumbing is already being built? So the gap between politics and plumbing. BRICS Pay is the plumbing, and it's worth understanding what it actually is before the hype runs away. Miles: Right. According to Riotimesonline, it's a decentralized messaging system linking four national networks: Russia's SPFS, China's CIPS, India's UPI, and Brazil's Pix- not a new currency, not a central clearing house. Grant: A connector-the idea is you settle in your own currency without routing through SWIFT or touching a dollar account. Prototype was demonstrated in Moscow in late twenty twenty four; full deployment is targeted for the New Delhi summit in September. Miles: And the underlying pipes already carry real volume-China's CIPS processed roughly one hundred seventy five trillion yuan in twenty twenty four, up forty three percent from the year before. before. By end of 2024, it had participants across 119 countries. Grant: That's not a pilot. That's operational infrastructure. But here's where it gets complicated. According to the BRICS Information Sharing Platform, the governance model is a DAO structure, decentralized, no mandatory fees, open source code. Miles: Which sounds clean on paper, but grant, is the DAO model real governance or just a way to avoid the The harder question of who actually controls this. Grant: That's the central tension, because three countries want three different things: India wants UPI style interoperability, each country keeping monetary sovereignty, China wants CIPS at the center, Russia wants SPFS connected. Miles: One announced system, three competing architectures underneath it. Grant: And the BRICS foreign ministers meeting in Delhi last week. Weak, failed to produce a joint statement-that's the tell. Miles: So for a Kenyan importer settling in Yuan today via CIPS, what actually changes when BRICS Pay goes live? Grant: In theory, they could route a rupee or rial transaction through the same rails without the dollar conversion step-lower friction, less exposure to OFAC oversight. Miles: In practice that Kenyan importer is still waiting on whether India and China And China can agree on whose message. Grant: The staging standard governs the handoff. Miles: And that's the honest read. The Techi piece on de-dollarisation put it well: 'BRICS has built alternative messaging and clearing infrastructure that reduces but does not eliminate SWIFT dependence.' The 'reduces' part is real; the 'eliminates' part is still a press release. Grant: The plumbing exists; the fittings are still being argued over; which raises the next question: what is the money denominated in? And once it moves through these pipes, that's a separate problem entirely, and it has a separate answer. Miles: So the pipes are being built. The deeper question is what currency actually flows through them. Grant: And that's where it gets quiet. On Halloween 2025, Russia's Institute of Economic Strategy launched a pilot of something called the Unit, 40% gold, 60% a basket of BRICS currencies. First batch 100 Units, each pegged to 1 gram of gold. Speaker 3: One hundred Units, that's not a system, that's a proof of concept. Grant: Exactly. This is laboratory work. According to reporting from Riotimesonline, IRIS issued that batch specifically to test the technical and operational framework before any wider rollout. Speaker 3: But the framing you keep seeing in Western financial media is gold-backed currency. That's not quite right, is it? Grant: No, and the distinction matters: gold anchored is more accurate. The Unit is not fully redeemable for physical gold. Per Watcher.guru, holders can't convert tokens into gold directly; only entire system nodes can liquidate reserves during structured exits. Speaker 3: So it's a collateral backstop, not a gold window. Grant: Right, think of it less like Bretton Woods and more like Keynes's Bancor concept: a neutral settlement unit, not a consumer currency. Speaker 3: And it's not official BRICS policy. NDB President Dilma Rousseff confirmed what sources described as agreement in principle to explore it. But India and Brazil have both been explicit that they're not seeking to replace the dollar. Grant: Which is the same tension we saw in Segment One: the architecture keeps getting built while the politicians Speaker 4: Right. Grant: say they're not. Not building anything. Speaker 3: Now here's the number that puts all of this in context: Gold surged over sixty per cent in twenty twenty five, hitting an intraday high near fifty five hundred and eighty nine dollars an ounce in January twenty twenty six. Grant: And BRICS central banks drove a lot of that demand. Between twenty twenty and twenty twenty four, they purchased more than fifty per cent of global gold acquisitions. You don't do that by accident. Speaker 3: The Unit's timing is not accidental either. You build a settlement instrument Miles: anchored to an asset you've been systematically accumulating for four years. Grant: That's the structural read. It's not that the Unit is ready; it's that the conditions for the Unit are being assembled quietly while everyone watches the summit communiques. Miles: Russian Deputy Foreign Minister Ryabkov has put twenty thirty as the target for operational status, with pilots possible before end of twenty twenty six. Speaker 3: Which brings us to the harder question: Miles: Designed for central banks and institutions targeting energy and agricultural settlements between member states, but what does any of that mean to a finance minister in Abuja or a trade company in Vietnam? Grant: That's the gap between the architecture and the lived reality, and that's exactly where we need to go next. Miles: So, who's actually sitting in the audience when BRICS talks about a new financial architecture? Speaker 3: Take Nigeria. Grant: Partner countries since January, twenty twenty-five—not a full member, no vote, no seat at the table when membership decisions are made. Speaker 3: And the naira is a perfect illustration of the dollar trap: oil revenues priced in dollars, external debts serviced in dollars. When the dollar strengthens, Nigeria absorbs the shock. Grant: The Riotimesonline BRICS Guide frames this well: the partner-country category gives political access without requiring adoption of any financial infrastructure; Nigeria gets the diplomatic optionality without burning its Western creditor relationships. Miles: Which sounds reasonable until you ask, optionality to do what exactly? BRICS Pay is an operational for daily trade settlement, the unit is a 100-token pilot targeting central banks. Grant: Right, so the theoretical alternative exists, the practical one doesn't; and the naira is still bleeding against the dollar in the meantime. Miles: Vietnam is the other case I keep coming back to—observer status with BRICS, heavy dollar dependency baked into its export economy; the dong lost around four and a half percent against the dollar in just the first seven months of twenty twenty four. Grant: And Vietnam's history with de-dollarization is instructive: high inflation, large foreign currency circulating domestically, deposit rate differentials slowing the whole process. Trying to exit dollar dependency too fast has historically historically damaged the domestic economy Miles: So the lesson isn't "Escape the dollar." It's "The transition costs are real, and you need a functional alternative before you start. Grant: Which brings up Argentina; Milei cooled the country out of BRICS membership on December twenty ninth twenty twenty three, doubled down on IMF support instead; that's the opposite choice. Speaker 3: And how's that going? Miles: Honestly, inflation came down from over two hundred percent to around thirty two percent by late twenty twenty five, but the country needed a twenty billion dollar IMF lifeline in April twenty twenty five just to stay solvent. Neither path is clean. Grant: That's the real story here: These countries aren't choosing between a bad option and a good one; they're choosing between a dollar system that extracts real costs and a BRICS architecture that doesn't fully exist yet. Miles: The partner country framework is essentially a waiting room; you get to observe the construction without committing to move in. Grant: And the pressure to stay in that waiting room is about to get a lot more direct: Washington has been watching all of this closely. Miles: That's the piece we need to get into-how U.S. policy is actively narrowing the choice these countries think they have. Speaker 3: So that whole question about whether countries have a real choice, Trump answered it with a threat. Grant: Pretty blunt math: dump the dollar, face one hundred percent tariffs. He posted it on Truth Social back in January 2025: no new BRICS currency, no backing any alternative, or you're done selling into the U.S. market. Speaker 3: And the Peterson Institute ran the numbers. A 100% tariff scenario hits GDP across the board, the U.S. included. The threat is mutually assured economic damage. Mitch! Grant: But here's what's interesting: the threat worked selectively; India folded publicly; Russia confirmed in January 2026 that common currency talks "have not taken place and are not taking place now"; and Brazil under Lula pushed Speaker 5: back. Grant: He came back rhetorically, but told Reuters it won't pursue a common currency either. Miles: Right, so the headline "BRICS Ambition: A Shared Currency Is Dead for Now." But here's the irony, Miles: the tariff pressure is suppressing the rhetoric while simultaneously accelerating the plumbing. Grant: Say more on that. Miles: Countries aren't going to announce a dollar exit-too costly-but they are quietly wiring up BRICS pay, deepening bilateral settlement in national currencies. building the infrastructure so the option exists later. The Trump compressed the timeline on the soft architecture. Grant: And then there's the Yuan problem sitting underneath all of it. Even if China wanted to fill the gap, it structurally can't. The Federal Reserve's own review flagged this. The Yuan is not freely convertible. Capital controls are the ceiling. Miles: The numbers tell the story. Per U.S. news citing IMF data, the dollar's share of global reserves sits at... Sits at about 56.7% as of end of 2025, down from over 70% in 2000, real erosion over 25 years. Grant: But the Atlantic Council had the dollar at Miles: Right. Grant: 89% of currency exchanges as of late 2025. That's the number people miss. Reserve shares slide slowly. Transaction dominance barely moves. Miles: So what you actually have is a dollar that's getting hedged, not replaced. Not replaced; the BRICS nations are building exits they don't plan to use yet, because the cost of using them right now is too high. Grant: Which puts everything on September: the New Delhi summit either delivers a functional BRICS Pay or this whole conversation stays theoretical for another year. Miles: And that's exactly the question heading into the closer, whether September is a real system going live or just another communique with good intentions and a ribbon on it. on it. So here's what September actually needs to deliver. Three signals worth watching before New Delhi. Grant: Starting with BRICS Pay, according to Riotimesonline, it's officially targeted for operational launch at the September 12-13 summit, with India's RBI leading technical coordination. Miles: Right, but the question to ask on September 14th is whether that launch is a real interoperable payment system or a press release with a logo. Grant: The distinction matters: The RBI has been running payment task force meetings as recently as May twelfth. There's real technical work happening-but governance across ten member currencies is genuinely hard. Miles: Signal two, the New Development Bank's local currency lending ratio: Dilma Rousseff confirmed the target is thirty percent of all loans in domestic currencies by end of twenty twenty six. They were sitting roughly at twenty five percent as of mid twenty twenty five. five. Grant: That gap from twenty five to thirty per cent. is the honest measure of whether the financial architecture is actually shifting, not the summit communique. Miles: The communique will say whatever the diplomats agree to; the NDB number is auditable. Grant: In Signal three-this one's outside the BRICS bubble entirely, Grant-Nigeria. Miles: Walk me through it. Grant: Nigeria is currently a partner country; its foreign minister has publicly stated they intend to apply for f For full membership: If Nigeria submits a formal application at or before the New Delhi summit, that tells you smaller economies view the new financial infrastructure as real enough to formally bet on. Miles: Africa's largest economy, Lagos as a financial centre: that's not a symbolic gesture, that's a capital flows decision. Grant: Exactly; and Lavrov said in May that BRICS won't rush further expansion, so if Nigeria pushes anyway... You're seeing demand-side pressure override the supply side has occasion. Miles: Three signals then, BRICS pay, real system or ribbon cutting, NDB local currency lending, does it close the gap to 30%, and Nigeria, formal application or continued optionality. Grant: September 13th is the date. Those three data points will tell you more about where this is actually headed than anything said at the podium. Miles: That's the episode India sharing BRICS while publicly backing the dollar and a U.S. trade deal closing in the background, that's the tension the whole hour kept circling back to. Grant: Right, and the BRICS pay architecture conversation really landed for me. Not a currency, not a clearinghouse, a connector. That distinction matters. Miles: The big takeaway: Alternative financial infrastructure is being built quietly, whatever the political rhetoric says out loud. Grant: Watch New Delhi in September. Whether BRICS pay goes live as a real operational system or just a symbolic announcement tells you everything. Miles: Three signals – BRICS pay deployment, NDB local currency lending, and Nigeria's membership status – Miles flag those at the close, and I think that's the right frame. Grant: If this episode gave you something to think about, share it with someone who needs a wider lens on global finance. Subscribe wherever you listen. Miles: Thanks for being here. We'll see you next week.