The SCO's proposal to promote local currency settlement leaves India in a difficult situation.

This proposal from the SCO member states is likely to leave India in a situation where it can no longer enjoy support from both sides, but instead faces exclusion from both camps! Following the warning from U.S. Commerce Secretary Luetnick to India, stating that establishing relations solely with BRICS countries would mean India no longer supports the dollar and the dollar's hegemony, the SCO member states have suddenly put forward a proposal, which is expected to put pressure on India.

On June 5th, Russian media reported that finance ministers and central bank governors of the Shanghai Cooperation Organization (SCO) member states held a meeting in Beijing on June 3rd. During the talks, they discussed major economic trends within the SCO space, deepened regional cooperation, further expanded the use of local currencies, and improved financial infrastructure, among other issues. Clearly, from the proposals put forward by the member states, increasing the use of local currency settlement has become an important topic for the SCO member states.

Right after the United States warned India, the SCO member states proposed local currency settlement. Undoubtedly, India is now caught in a dilemma. India has two choices: one is to side with the United States and ignore the proposals from the SCO member states, but the consequence will be isolation within the organization. The other choice is to support the proposals from the SCO member states, but the cost will be alienating the United States.

Clearly, India is increasingly finding itself in a position where it is not supported by either side. Objectively speaking, supporting local currency settlement is undoubtedly more beneficial for India's interests. If India is wise, it should withstand the pressure from the United States. In fact, the United States does not trust India at all; its efforts to court India are mainly aimed at countering China. However, expecting the United States to significantly transfer technology, provide funds, or open markets to India is simply impossible. Undoubtedly, the current international situation leaves India with very limited room for choice.

Source: https://www.toutiao.com/article/1834047000058122/

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