The 2026 New Delhi Declaration arrives at a revealing moment for BRICS: two decades after the grouping emerged as a shorthand for the rising economic weight of the Global South, it is no longer merely demanding a larger seat at the table of global governance, but is beginning to construct the institutional plumbing that could allow its members to operate with less dependence on systems they do not control. Yet, the declaration also exposes the central paradox of the BRICS project. The larger and more politically diverse the grouping becomes, the less plausible a unified alternative to the Western-led economic order appears — and the more attractive a strategy of selective hedging becomes.
This is why the familiar language of “multipolarity”, “equitable global governance” and reform of international institutions should not be mistaken for evidence of an emerging BRICS economic union. Beneath the diplomatic vocabulary lies something more pragmatic and potentially more durable: an attempt to create enough redundancy in energy, trade and financial systems to ensure that BRICS members are not left strategically exposed when geopolitical rivalry disrupts the existing order.
The distinction matters. BRICS is not, at least for now, dismantling the global economic architecture. It is building escape routes around its vulnerabilities.
The clearest evidence comes from the declaration’s treatment of energy, trade and currency — three areas in which the bloc’s strategic ambitions collide most directly with its internal economic differences. The energy debate exposes perhaps the most fundamental contradiction between the priorities of developed economies and those of emerging markets.
For much of the industrialised world, the transition away from fossil fuels is increasingly embedded in regulation, investment decisions and trade policy. For much of the developing world, however, the uncomfortable reality is that hydrocarbons remain indispensable to industrialisation, transport, electricity generation and economic growth.
The declaration’s recognition that fossil fuels will remain part of the energy mix of developing countries therefore represents more than diplomatic pragmatism. It is a rejection of the assumption that every economy can follow the same decarbonisation timetable irrespective of its stage of development.
BRICS is effectively arguing for a transition that does not require developing economies to sacrifice energy security in pursuit of climate objectives defined elsewhere.
That position becomes sharper when viewed against measures such as the European Union’s Carbon Border Adjustment Mechanism. BRICS’ criticism of CBAM as a protectionist instrument dressed in environmental language reflects a broader anxiety: that climate policy could increasingly become an instrument through which richer economies impose adjustment costs on poorer producers.
The problem, however, is that BRICS itself has no unified energy strategy . Russia and other hydrocarbon producers have an obvious interest in preserving demand for fossil fuels; China and India remain major energy consumers while simultaneously expanding renewable capacity; and several other members face very different resource and development constraints. A common declaration can accommodate these differences precisely because it avoids binding commitments.
The more interesting development, therefore, is not the defence of hydrocarbons, but the simultaneous push towards the technologies of the next energy system.
The BRICS Guiding Principles on smart grids and cooperation on low- and zero-emission hydrogen suggest that the grouping understands where the energy system is heading even as it refuses to abandon the fuels on which its present economy depends.
That is a hedge, not a contradiction. BRICS wants access to tomorrow’s clean-energy economy without allowing today’s energy-security requirements to be dictated by someone else’s timetable.
The same logic runs through the declaration’s trade agenda. BRICS continues to insist that the World Trade Organization must remain at the centre of a rules-based, non-discriminatory trading system and calls for the restoration of a functioning dispute-settlement mechanism. On paper, this is a defence of multilateralism.
But alongside that commitment sits an increasingly elaborate effort to strengthen intra-BRICS trade mechanisms, commodity platforms, supply-chain arrangements and financial institutions.
This apparent contradiction is actually the heart of the strategy. BRICS does not necessarily want to replace the WTO. It wants to reduce the damage its members could suffer if the WTO becomes less effective, if unilateral tariffs become more common or if geopolitical rivalry makes access to established trade and financial channels unpredictable. The emerging architecture is therefore one of institutional redundancy.
The BRICS Grain Exchange, commodity initiatives, global value-chain cooperation, special economic zones and proposed investment mechanisms are not substitutes for the entire global trading system. They are insurance against its fragmentation.
That distinction is particularly important in an era when trade policy is increasingly being shaped not only by tariffs but by export controls, sanctions, subsidies, technology restrictions, environmental standards and national-security considerations.
The old assumption that economic interdependence would automatically restrain geopolitical rivalry has become much less convincing. BRICS is responding by attempting to make interdependence more geographically and institutionally diversified.
Yet here again lies the group’s vulnerability. Creating alternative platforms is considerably easier than making them commercially competitive. Businesses will not abandon established exchanges, payment systems, logistics networks or dispute mechanisms merely because governments announce alternatives. They will move when the alternatives are cheaper, faster, safer and more predictable. BRICS therefore faces a test that cannot be resolved through political solidarity: whether its proposed institutions can deliver better economics.
Nowhere is the difference between rhetoric and reality more important than in the debate over the dollar. For years, the phrase “de-dollarisation” has generated expectations that BRICS might eventually create a common currency capable of challenging the dollar’s global role. The 2026 declaration, however, points towards a far less dramatic — and arguably more realistic — strategy.
There is no serious commitment to a single BRICS currency.
Instead, the emphasis is on interoperability between payment systems, cross-border financial messaging and greater use of national currencies in trade and investment. This is a crucial distinction. A common currency would require extraordinary levels of monetary coordination, fiscal discipline, capital-market integration and political trust among economies that currently have very different macroeconomic structures and policy priorities.
The BRICS approach avoids that trap.
For India and Brazil, for example, reducing dollar dependence can be understood primarily as an exercise in financial resilience and transaction efficiency rather than an ideological campaign against the United States. For Russia and Iran, the strategic calculation is more directly linked to sanctions and insulation from Western financial infrastructure.
Those motivations overlap, but they are not identical. The flexibility of local-currency settlement allows them to coexist. Yet even here, BRICS faces a basic economic constraint: currencies become international because markets want them, not because governments instruct them to be used.
An Indian exporter accepting a partner’s currency still needs confidence that the currency can be converted, hedged and invested efficiently. A Brazilian company settling in another BRICS currency needs liquidity and reliable financial markets. Banks need settlement infrastructure that works around the clock and regulatory systems that reduce rather than increase operational risk.
Payment interoperability is therefore potentially transformative, but only if BRICS can solve the less glamorous problems of liquidity, convertibility, settlement and trust. The strategy is evolution rather than revolution. And that may be precisely why it has a chance of working. The fundamental challenge, however, is political.
BRICS has expanded precisely at a time when its members have increasingly divergent foreign-policy priorities. Some seek strategic autonomy and maintain relationships with both Western and non-Western powers; others view the grouping as a vehicle for resisting what they regard as Western economic and geopolitical dominance.
India and Brazil, in particular, have little incentive to transform BRICS into an explicitly anti-Western economic bloc. Their interests are better served by preserving room for manoeuvre. Russia and Iran have stronger reasons to favour systems that reduce exposure to Western sanctions and financial institutions. China occupies a position of its own, possessing the economic scale to push for greater institutional alternatives while remaining deeply integrated into global trade and investment networks.
The genius — and perhaps the only workable feature — of the BRICS model is that it does not require these countries to resolve those differences. Instead, it increasingly relies on voluntary participation, flexible arrangements and incremental cooperation.
That is why initiatives such as the New Investment Platform, BRICS Multilateral Guarantees, the New Development Bank and cross-border payment mechanisms are potentially more important than grand declarations about a new world order. They can be used without requiring members to agree on everything else.
Seen in this light, the New Delhi Declaration should not be read as a blueprint for the overthrow of the existing global economic system. It is better understood as a blueprint for reducing dependence on any single system. That is a subtler ambition, but potentially a more consequential one.
If BRICS can create alternative channels for financing infrastructure, settling trade, insuring investments, moving commodities and transferring money, its members gain bargaining power even when those channels remain smaller than their Western counterparts. The objective is not necessarily to replace the dollar, the WTO, the IMF, the World Bank or Western commodity exchanges. It is to ensure that their dominance no longer leaves BRICS without alternatives.
That is the essence of the triple hedge: energy security without abandoning decarbonisation; trade diversification without abandoning the WTO; and financial autonomy without prematurely attempting a common currency.
The strategy also explains why the declaration is simultaneously ambitious and cautious. BRICS knows that an abrupt attempt to construct a parallel global order would expose the profound differences among its members. A modular system, by contrast, allows countries to cooperate where interests converge and disengage where they do not.
This may look less revolutionary, but it is more politically sustainable.
The danger is that institutional proliferation could substitute for institutional effectiveness. BRICS can create working groups, platforms, exchanges, payment mechanisms and declarations almost indefinitely. What it cannot manufacture through diplomacy alone is liquidity, credibility and commercial adoption.
That is where the real test begins.
The future of BRICS will not be determined by how often its leaders invoke multipolarity. It will be determined by whether an Indian importer can settle a transaction more cheaply in a partner currency, whether a Brazilian infrastructure project can obtain cheaper financing through a BRICS mechanism, whether a developing economy can insure a major investment at a lower risk premium, and whether businesses actually prefer BRICS trade platforms to established global alternatives. If the answer eventually becomes yes, the institutional consequences will be profound.
BRICS would not have overthrown the existing economic order. It would have made that order less indispensable. And that may be the more important transformation.
The New Delhi Declaration therefore marks neither the birth of a unified BRICS economic system nor the imminent demise of the dollar-centred global economy. It marks something more practical: the construction of a strategic insurance policy against fragmentation. In an increasingly uncertain world, that may prove to be BRICS’ most consequential project yet. (IPA Service)
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