BRICS+ Nations Overtake G7: A New Dawn in Global Trade

The economic sway of BRICS+ nations, spearheaded by India and China, is transforming global trade. An EY India report reveals a surge in BRICS+ exports from 10.7% to 23.3% between 2000 and 2023, with predictions of surpassing G7 by 2026, amid a decline in US dollar dominance.

The ascent of countries such as India and China is reshaping the global economic framework, drawing attention away from traditional G7 nations towards the BRICS+ alliance, a recent report by EY India reveals. The document underscores a pivotal shift in global trade dynamics, with BRICS+ markedly expanding its participation in global export and import activities.

According to the report, India and China, integral members of the BRICS+ alliance, held third and first positions globally in terms of purchasing power parity (PPP) in 2023, and are predicted to maintain these standings through 2030. The data also reveals a remarkable increase in BRICS+ share of global merchandise exports, rising from 10.7% in 2000 to 23.3% by 2023, a growth of 12.6 percentage points. In contrast, the G7's share experienced a steep decline from 45.1% to 28.9%.

The report acknowledges the rest of the world's stable share in global exports, which increased marginally from 44.2% to 47.9%. BRICS+ nations' burgeoning role in global trade is evident. DK Srivastava, EY India's Chief Policy Advisor and 16th Finance Commission Advisory Council member, asserted that current trends and the potential induction of new members could see BRICS+ surpassing the G7 in global merchandise exports by 2026.

China has been pivotal in this transformation, with its contribution to BRICS+ exports intensifying from 36.1% in 2000 to 62.5% in 2023. India also shows impressive advancement, constituting 7.9% of BRICS+ exports this year. Furthermore, the report highlights the increasing significance of high-tech exports from BRICS+ nations, whose global share leaped from 5.0% in 2000 to 32.8% in 2022. This trend signifies a shift towards technology-centric products, establishing BRICS+ as key players in the high-tech marketplace.

Significantly, the US dollar's share as the global reserve currency has decreased from 71.5% in 2000 to 58.2% by 2024, suggesting a gradual transition towards a more multipolar currency system.

(With inputs from agencies.)