BRICS Targets US Tariffs, Western Sanctions and EU Carbon Tax—Without Naming Them

Trade is a major focus of the New Delhi Declaration, with 17 paragraphs addressing tariffs, sanctions, WTO reform, supply chains and intra-BRICS commerce. Although the declaration avoids naming countries, its targets are often clear. GTRI identifies the countries and policies behind these carefully worded criticisms.

The declaration supports a rules-based multilateral trading system and calls for the restoration of the WTO’s two-tier dispute-settlement mechanism (Para 20). This appears to be aimed at the United States. Its unilateral tariffs have violated WTO rules, while its refusal to approve new Appellate Body members has paralysed the WTO’s appeals system. The Appellate Body has been unable to hear new appeals since December 2019 because the United States blocked the appointment of new members.

It also expresses concern over WTO-inconsistent trade restrictions, including indiscriminate tariff increases and “protectionism under the guise of environmental objectives” (Para 21). The first reference appears to target recent US tariffs, while the second points to the European Union’s Carbon Border Adjustment Mechanism, or CBAM, which adds a carbon-related cost to imports.

BRICS also condemns unilateral economic and secondary sanctions that violate international law (Para 22). This appears to refer to US and European sanctions against Russia and Iran, as well as threats of secondary sanctions against countries and companies that continue trading with them. For example, the United States has threatened penalties against firms and countries that purchase sanctioned Russian oil or conduct transactions with designated Iranian entities.

The declaration directly opposes “unilateral, punitive, discriminatory and protectionist measures” such as carbon border adjustment mechanisms (Para 108). This is a clear criticism of the EU’s CBAM, although the European Union is not named. CBAM imposes an additional carbon-related cost on exports of products such as steel, aluminium, cement and fertilisers to the EU, potentially weakening the competitiveness of developing-country exports.

On West Asia, the declaration calls for the smooth flow of global trade, supply chains and energy (Para 28). This appears to urge both the United States and Iran to avoid actions that could disrupt shipping and energy supplies through the Strait of Hormuz. In the past six months, blockades, military strikes and attacks on commercial vessels in the Strait have disrupted oil, gas and other shipments, raising freight and insurance costs and pushing up global energy and raw-material prices.

BRICS also calls for a fair and development-oriented agricultural trading system and the revival of WTO agriculture negotiations (Para 63). This reflects concerns that existing WTO rules allow developed countries to provide large farm subsidies, while negotiations to correct these imbalances have made little progress. Issues important to developing countries—such as a permanent solution for public food stockholding and an effective Special Safeguard Mechanism to protect farmers from import surges—remain unresolved. Meanwhile, developed countries continue to provide substantial agricultural support that developing economies cannot afford to match.

The declaration also proposes practical measures to expand intra-BRICS trade. These include local-currency settlements, faster and cheaper cross-border payments, easier trade finance and invoice discounting for MSMEs, stronger and more inclusive global value chains, digitised trade documentation, cooperation among SEZs, customs coordination and trade insurance. It also supports trade in diamonds and precious metals, better resolution of cross-border commercial disputes and closer engagement among BRICS businesses.

Overall, the declaration uses careful diplomatic language to manage conflicting interests within BRICS. It does not name the United States or the European Union, but the countries and policies being criticised are often clear from the context.

This diplomatic ambiguity allowed BRICS to criticise specific Western policies without triggering an open confrontation or exposing internal differences among its members.