When Trade Becomes a Weapon: Reflections on BRICS, Deficits and Diplomatic Balance

I find myself thinking about the paradox at the heart of modern diplomacy: we celebrate economic interdependence as progress, and yet we weaponize that very interdependence when politics turns confrontational. The recent BRICS virtual summit brought that paradox into stark relief — leaders and ministers warned about tariffs, lamented “trade as a weapon,” and asked the grouping to do more than simply issue statements. I want to set down what struck me, why it matters, and what a pragmatic BRICS response might look like.BRICS Summit 2025 – India Calls for Fair Economic Practices

What I heard at the summit — and why it felt different

• The immediate context was clear: steep punitive tariffs have been imposed on several BRICS economies, and the rhetoric is loud enough to unsettle markets and supply chains. Several reports noted the high tariffs and the summit’s pushback against linking trade restrictions to non‑trade issues Jakarta Globe, Scroll.
• India’s voice was distinctive because it combined two things that are easy to set in opposition but, in my view, must coexist: resistance to the weaponization of trade and honest accounting of India’s own trade imbalances with some BRICS partners. External Affairs Minister Jaishankar urged BRICS to stabilise the global economy while also asking partners to review intra‑BRICS trade flows to address deficits that hurt Indian industry and jobs Desi Talk Chicago, CNBC.
• Not every BRICS member reads the ledger the same way. For some, the meeting was as much about resisting what they see as unilateral pressure as it was about economics — a reminder that BRICS sits at the intersection of geopolitics and commerce MSN.

Why the dual message from India matters to me

I have long believed that a nation’s strategic autonomy is not an excuse for complacency, nor is it a shield for protectionism. India’s posture at BRICS — standing against the politicization of trade while asking partners to address real bilateral deficits — is an attempt at a difficult middle path. It says: push back against unfair external punishment, but also practise internal repair. That combination is rare in international fora and, I think, necessary if BRICS is to be more than a rhetorical club.

Practical levers BRICS can use to reduce trade deficits and raise resilience

Words matter, but so do instruments. If BRICS wants to help member states reduce trade imbalances and blunt the effect of external tariff shocks, here are practical ideas that struck me as sensible and attainable:

• Strengthen intra‑BRICS market access: targeted trade facilitation for under‑exporting sectors, tariff lines for labour‑intensive goods and services agreements that help diversify exports away from single markets Vajiram & Ravi summary of the summit.
• Use financial architecture creatively: the New Development Bank and Contingent Reserve Arrangement can be expanded to provide working‑capital lines, export credit support, and currency swap arrangements that ease payment frictions when tariffs bite CNBC reporting on BRICS economic initiatives.
• Harmonize standards and cut non‑tariff barriers: often deficits persist not just because of price but because of regulatory misalignment. A BRICS working group on standards could have outsized impact.
• Invest in regional value chains and manufacturing democratization: diversify where goods are produced so no single member becomes the choke point for critical inputs — a point repeatedly raised in summit commentary about resilient supply chains Desi Talk Chicago.
• Data‑driven export promotion: identify BRICS markets where each member’s comparative advantage is under‑realized and run coordinated export promotion campaigns and buyer‑seller meets.

These are not exotic prescriptions; they are the kind of boring, bureaucratic, patient work that changes trade balances over years, not days.

The risks that worry me

• Escalation: tariffs invite retaliation, and a tit‑for‑tat can spiral into broader protectionism that damages growth everywhere. The summit exposed that risk — members share grievance but differ on escalation appetite Jakarta Globe.
• Fragmentation of rules: if blocs start to substitute rules for the global system with bespoke arrangements, developing countries could be squeezed by competing frameworks.
• Geopolitical drift: if BRICS becomes primarily geopolitical, economic solutions will be subordinated to strategic rivalry — and deficits will persist while rhetoric grows louder MSN analysis.

A philosophical note: why rules still matter

I am a believer in institutions not out of romanticism but because rules reduce uncertainty. The trading system’s principles — openness, non‑discrimination, and predictability — are not platitudes; they are tools that allow businesses to plan, farmers to sell, and manufacturers to invest. When those rules fray, the most vulnerable are often the ones who suffer first: small exporters, informal workers, the farmers who feed urban markets. Jaishankar’s appeal to preserve a rules‑based system with special and differential treatment for developing countries was not only strategic; it was moral Scroll.

How I think this might evolve

I am cautiously optimistic but realistic:

• Short run: expect continued economic signaling and tactical measures — tariffs, counter‑measures, negotiation offers and headline diplomacy. Talk will be loud; change will be incremental.
• Medium run: if BRICS pursues the pragmatic levers above (finance, trade facilitation, standards and manufacturing democratization), we might see a partial rebalancing of trade flows and greater resilience in supply chains — but it will require political will.
• Long run: the real test is whether major economies choose reform over retaliation. If they do, the global order can be nudged back toward cooperation and reform; if not, we risk frozen blocs and persistent inefficiencies.

Closing thought

Trade is a mirror of our choices. We can weaponize commerce and watch the reflection of that choice ripple into food and fuel insecurity, slower growth and deeper mistrust. Or we can treat trade as a tool of mutual gain — not naive pacifism, but deliberate policy that recognizes interdependence and designs institutions to make it stable and fair. BRICS sits at that fork in the road. The wiser path is less glamorous: meticulous, patient, and often invisible. But it is the only path that rebuilds trust and reduces deficits without igniting fresh conflict.

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Regards,
Hemen Parekh