Correspondent
NEW DELHI — The 18th BRICS Summit offers an opportunity to deepen India’s economic engagement with growing markets and turn BRICS cooperation into tangible benefits for Indian companies, PHD Chamber of Commerce and Industry said on Sunday.
For industry, the success of BRICS should ultimately be measured by whether it makes cross-border trade and investment cheaper, faster and simpler, the PHD Chamber of Commerce and Industry stated.
“First, India should push for a system to remove trade barriers,” said Rajeev Juneja, president of PHDCCI.
Indian companies often face different customs procedures, paperwork, standards and regulations across markets. A BRICS Trade Barriers Resolution Mechanism could provide businesses with a way to report such issues, assign them to the appropriate authorities and track their resolution. This would turn trade facilitation from a broad commitment into a mechanism businesses can actually use, Juneja said.
Second, BRICS should make it easier for businesses to use different currencies for trade, including the Indian rupee. Greater use of local currencies could help lower transaction costs and some of the risks associated with cross-border payments. However, businesses need more than an agreement. They need banks capable of processing such payments, correspondent banking arrangements and practical mechanisms for using local currencies.
The objective, Juneja said, should be to provide businesses with more payment options rather than create a single BRICS currency.
Third, India should leverage its Unified Payments Interface, or UPI, to facilitate cross-border payments. India has demonstrated that digital payments can be fast, simple and inexpensive. The next step could be to connect BRICS payment systems so businesses and individuals can make cross-border payments more easily.
Interoperable QR payments, faster money transfers and common technical standards could be particularly useful for medium-sized businesses, service providers and small exporters, Juneja added.
Fourth, BRICS needs to address the financing challenges faced by small and medium-sized businesses. For smaller exporters, finding a buyer is only part of the challenge. Securing finance against an order and managing payment delays can be equally difficult.
Building on the Jaipur Consensus, India could push for mechanisms that enable businesses to access invoice financing and trade finance. Linking such mechanisms with India’s Trade Receivables Discounting System, or TReDS, could help small exporters convert verified invoices into working capital.
Fifth, BRICS should work to reduce the burden of different standards and certification requirements. A product that meets standards in one market may still require additional testing or approval before entering another.
Sector-specific arrangements could help reduce these costs. Pharmaceuticals, engineering products, automobiles, electronics, food processing, chemicals, textiles and medical devices could be among the sectors considered.
Sixth, India should use BRICS to strengthen supply chains. Recent global disruptions have shown how quickly a shortage of a single component, mineral or energy source can affect entire industries.
BRICS could identify vulnerabilities in supply chains covering medicines, electronics, semiconductors, critical minerals and energy while promoting diversified sourcing and investment. This could strengthen India’s manufacturing base and open new opportunities for Indian companies.
Seventh, services need greater attention. India’s strengths extend beyond merchandise exports. Information technology, engineering consultancy, health care, education and other professional services offer significant opportunities across BRICS markets.
A BRICS Services Facilitation Framework could address issues such as recognition of professional qualifications, digital services and the movement of skilled professionals, helping Indian companies expand their presence, Juneja said.
Eighth, the New Development Bank should become a stronger source of financing for projects. India could push for NDB funding for transport infrastructure, industrial areas, clean energy, digital infrastructure, small and medium-sized businesses and climate-related projects.
Local-currency lending and greater cooperation with private investors could help turn BRICS financial cooperation into projects on the ground.
Ninth, energy and critical minerals should remain central to the economic agenda. For businesses, energy security is closely linked to competitiveness. Fluctuations in oil prices or shortages of critical minerals can raise production costs, increase India’s import bill and contribute to inflation.
BRICS cooperation on mineral supply chains, processing, clean energy, energy storage and battery materials could provide greater security while creating new investment opportunities.
Finally, industry needs a place at the BRICS table. A BRICS-Industry Business Facilitation Mechanism, bringing together business groups from member countries, could help companies establish connections while also monitoring whether commitments made at the Summit are being implemented.
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