On the other hand, the BRICS grouping of Brazil, Russia, India, China and South Africa has been making sustained efforts to work together to address the issues of global concerns like the climate crisis, an unjust international financial system, and an unrepresentative UN Security Council. At the BRICS Summit in Kazan, Russia, in October 2024, the BRICS leaders condemned unilateral measures introduced under the pretext of climate and environmental concerns. They reiterated the commitment to enhancing coordination on these issues. The theme of the Summit was “Strengthening Multilateralism for Just Global Development and Security”. BRICS principles of functioning include mutual respect, sovereign equality, openness, inclusiveness, collaboration and consensus.

The persistent unilateral use of tariffs by the US as a foreign diplomacy tool can be seen to tackle two interrelated factors: multilateralism and geopolitical interests. The US uses tariffs to sanction countries as punitive measures to force them to fall in line. President Trump views the US as unduly conceding in unequal terms to its trading partners at the cost of American interests and seeks a review of its bilateral and multilateral engagements. It is mainly reflected in the case of its trade

conflicts with China, Mexico, Canada, Brazil, and India, among others. Trump’s bemoaning of the World Trade Organization (WTO) framework benefiting China from the free trade regime and removal of restrictions on global trade comes with an answer to engage in selected multilateralism, stepping aside into isolationism.

It is also tied to the interrelated factor of slowly slipping from its position as the leader in American industrial innovation and giving way to China in particular. Therefore, tariffs are also used as a geopolitical tool to counter the rise of China, which is advancing at an incredible pace in its industrial and technological innovations. For example, Chinese DeepSeek Artificial Intelligence (AI) has recently surpassed the American ChatGPT in advancement, efficiency, cost, and user accessibility.

It has put the US at the edge of the neo-liberal global order, which has been under constant review by the collective efforts of Global South countries, such as the BRICS grouping. Increasing trade tariffs goes against the WTO principle of free and transparent global trade and the most favoured nation (MFN). Trump also called the regional economic cooperation framework—the North American Free Trade Agreement among the US, Canada and Mexico the “worst trade deal ever made”.

The BRICS nations have been facing challenges, directly or indirectly, from unilateral US trade sanctions. US-led trade and banking sanctions against Russia in 2014 due to the annexation of Crimea and in 2022 due to the invasion of Ukraine have been well documented. Iran is another country which continues to face economic and trade sanctions against its nuclear programmes. The US’s punitive use of the dollar and SWIFT against Iran is well recorded as a geopolitical measure affecting the latter’s international trade.

BRICS nations have been searching to circumvent the dollar-based international financial system. Iran and India agreed to export Iranian oil and gas to India using a rupee-rial payment mechanism, while Iran purchased Indian goods in rupees. Iran later joined BRICS in January 2024, given the BRICS attractiveness as an economic grouping. The 16th BRICS Summit in Kazan, Russia, in 2024 announced the establishment of BRICS Pay as an alternative payment system to promote inclusive multilateralism.

The BRICS nations, particularly India, China, Russia, Brazil, and Iran, have been strengthening cooperation to minimise the effects of the US tariffs without necessarily pitting themselves against established multilateral institutions.

However, the idea of a BRICS currency around the BRICS Summit at Kazan last year received Trump’s ire. On several occasions, Trump warned BRICS nations of the likely imposition of 100 per cent tariffs against them if they create a BRICS currency that challenges the US dollar supremacy. The US dollar is the dominant international currency with 88% of the total foreign exchange transactions, according to the Bank of International Studies Quarterly Review for December 2022.

The US and the West pressured Russia for its invasion of Ukraine by cutting the country off the SWIFT cross-border payment system. SWIFT is a global payment system that facilitates international transactions. Alternatively, China’s Cross-border Interbank Payment System (CIPS) facilitated Russia’s cross-border payments for trade with third countries. It promoted China’s ambition of promoting the Chinese renminbi as an international currency to the US dollar. Russia also has developed its own SPFS as a substitute to SWIFT to tackle the dollar challenge to cross-border payments.

Trump’s tariff threats against BRICS are also related to the potential success of the BRICS initiative of BRICS Pay to reduce dependency on the dollar and ensure equal access to financial services and technologies for all countries. BRICS Pay, launched in October 2024, is a decentralised payment system that facilitates transactions in local currencies among member countries. It will reduce dependency on the dollar or euro. It is an initiative to create a fair, efficient, stable new global financial architecture.

The US sanctions on China targeting technology and trade sectors have incurred counter-tariffs from the latter. Trump 1.0 imposed 25% tariffs on over $500 billion worth of Chinese goods. His successor continued such tariffs. In 2018-2019, the US raised import tariffs from China worth about $450 billion, which was followed by counter-tariffs of about $100 billion. The US also banned exports of AI chips or advanced semiconductors to China to prevent the latter from climbing the ladder in the technology sector.

More US sanctions are looming over China, Iran, and Russia, which also face trade restrictions on third countries that trade with them. For example, India is affected indirectly for engaging with these sanctioned countries by an alleged exchange with Russia’s military-industrial base in November 2024 or sanctions against Iranian oil exports in February 2025. Moreover, India’s trade in Russian oil was affected due to further US sanctions in January 2025.

Strengthening BRICS and South-South trade constitutes a way out of these protectionist measures from the US and the West. China’s enormous economic clout provides opportunities for Brazil and Russia to grow their economic partnership with the country. Trump's Tariffs against Canadian energy exports have brought Canada to China for cooperation in the energy sector.

Overall, unilateral protectionist measures are not helping stabilise the global economy. Moreover, the US sanctions under Trump indicate shifting priorities to national security and economic concerns over multilateral commitments. The dominant position of the West in the international political economy is owed to their contribution to developing international systems. However, lacking inclusivity and is far from promoting a just development that caters to the needs of the Global South.

The BRICS grouping is a “work-in-progress” based on a piecemeal approach. It now represents over 45% of the global population, 40% of its trade, 40% of crude oil production and exports and about 30% of its Gross Domestic Product. Given the magnitude of the grouping’s representation, their call for a just global development itself is not mere symbolism but a ‘force’ to be reckoned with. Expanded BRICS or BRICS Plus has 11 members, including Saudi Arabia, Egypt, United Arab Emirates, Ethiopia, Iran in 2024 and Indonesia in 2025. BRICS forum brings collective efforts to developing nations of the Global South to address common development challenges. It does not come with conditionalities for development support, unlike the Bretton Woods institutions.

This article is authored by Mehdi Hussain, research associate, Indian Council of World Affairs, New Delhi.