BRICS Trade Imbalances Complicate U.S. Dollar De-dollarization Efforts

BRICS leaders are preparing to debate expanding trade in local currencies to reduce dependence on the U.S. dollar. However, analysis from the Global Trade Research Initiative reveals structural weaknesses in the bloc's economic architecture that may hinder these goals.

Data shows a hub-and-spoke trade pattern centered on China, which exports $550.8 billion to other members. While the bloc represents over one-fifth of global merchandise trade, intra-BRICS exports account for only 4.1% of global exports. This imbalance is particularly acute for India, where the trade deficit with BRICS nations tripled over five years to $226.1 billion in fiscal year 2026.

In that period, BRICS nations supplied 41.5% of India's merchandise imports but absorbed only 21.7% of its exports. These one-directional trade flows, such as India's energy-driven deficit with Russia, make sustainable local-currency settlements difficult to maintain, complicating the bloc's broader strategy to move away from the dollar.