The Engineering Exports Promotion Council of India has proposed removing non-tariff barriers and adopting local currency payments within BRICS. These changes aim to support the engineering sector, which makes up 27% of India's merchandise exports. The proposal seeks to lower costs and reduce currency risk for exporters navigating complex regulatory environments in key emerging markets.
The Engineering Exports Promotion Council (EEPC) of India, the body representing the engineering sector under the Ministry of Commerce & Industry, has proposed a significant change to trade policies within the BRICS bloc. During the 18th BRICS Summit held in September 2026, the council urged member nations to eliminate non-tariff barriers and establish smooth payment mechanisms using local currencies.
Engineering goods are a vital component of India’s economy, contributing approximately 27% to total merchandise exports. Currently, Indian exporters face difficulties due to varying technical standards and complex compliance requirements across member nations, including China, Brazil, Indonesia, Saudi Arabia, and South Africa. According to EEPC India Chairman Pankaj Chadha, aligning these regulatory standards and streamlining payment systems could resolve up to 75% of the operational challenges currently faced by engineering exporters.
The proposal focuses on lowering transaction costs, which have become a point of concern for smaller businesses aiming to enter or expand within these emerging markets. By moving toward local currency settlement, the council aims to reduce the dependence on dominant global currencies and limit the impact of exchange rate volatility on cross-border engineering contracts.
While the proposal aims to create a more efficient trade environment, the sector faces several structural risks. A primary concern is the existing trade deficit India maintains with many BRICS nations, often driven by high energy imports. Addressing this requires a stronger focus on export growth to balance trade relationships effectively. Additionally, exporters continue to navigate geopolitical uncertainties that affect shipping routes, particularly in West Asia, which can disrupt supply chains and increase the cost of doing business.
Furthermore, the diversity of technical standards across the BRICS bloc remains a hurdle for many Indian firms. Smaller enterprises, in particular, often struggle to scale their operations due to the time and cost involved in meeting these varying requirements. If the proposed framework leads to a unified agreement on regulatory alignment, it could provide a more stable path for Indian engineering companies to increase their footprint in these markets.
The next phase for the industry involves tracking how quickly these policy discussions translate into binding commitments during future trade negotiations. For Indian exporters, the effectiveness of these measures will depend on the actual implementation of simplified standards and the willingness of member nations to transition toward local currency settlements.