The leaders of Brics nations have adopted the idea - put forward in this column - of conducting trade between the five nations in their own currencies. Two agreements, signed among the development banks of Brazil, Russia, India, China and South Africa, say that local currency loans will be made available for trade between these countries.With five fast-growing nations participating in local currency trade, it is unlikely that the system will fall into the rupee-rouble rut into which Indo-Soviet trade sank in the 1980s. It will allow participants to diversify their foreign exchange portfolios, hedging against movements in, say, the dollar. Higher intra-Brics trade, conducted in our own currencies will shield our economies from disruptions in the west. Source
