BRICS Expansion and De-Dollarization: Implications for Pakistan in a Multipolar World Order

Introduction

The post–Cold War unipolar world order, dominated largely by the United States and Western institutions, is undergoing a visible transformation. The expansion of the BRICS bloc and the growing debate on de-dollarization represent a critical shift toward a multipolar global system. For developing countries like Pakistan, this evolving order presents both strategic opportunities and complex challenges. Understanding these dynamics is essential for Pakistan’s economic resilience, foreign policy recalibration, and long-term stability.

Background: BRICS and the Rise of Multipolarity

BRICS—initially comprising Brazil, Russia, India, China, and South Africa—emerged as a platform for emerging economies seeking greater representation in global decision-making. In recent years, the bloc has expanded by inviting new members from Asia, Africa, and the Middle East, reflecting a shared dissatisfaction with Western-led financial and political institutions.

This expansion signals:

Declining monopoly of Bretton Woods institutions

Emergence of alternative power centers

Growing assertion of the Global South

The shift from unipolarity to multipolarity aims to distribute power more evenly, potentially reducing systemic imbalances in global governance.

De-Dollarization: Concept and Momentum

De-dollarization refers to efforts by states to reduce reliance on the US dollar in international trade, reserves, and financial settlements. BRICS countries have initiated:

Trade in local currencies

Strengthening the New Development Bank

Alternative payment mechanisms to bypass sanctions pressure

Although the US dollar remains dominant, these steps mark a gradual erosion of dollar hegemony, especially in energy and commodity trade.

Pakistan’s Strategic Relevance in the New Order

Pakistan occupies a geopolitically significant location at the crossroads of South Asia, Central Asia, and the Middle East. Its strategic partnership with China, particularly through China–Pakistan Economic Corridor (CPEC), aligns it closely with the emerging multipolar framework.

Economic Opportunities for Pakistan

For Pakistan, BRICS-led initiatives offer:

Diversification of trade partners

Reduced dependence on dollar-denominated transactions

Access to alternative development financing

Potential relief from IMF-centric conditionalities

Participation in non-dollar trade mechanisms could help Pakistan manage balance-of-payments pressures and foreign exchange volatility.

Challenges for Pakistan

Despite these prospects, Pakistan faces significant constraints:

Fragile macroeconomic fundamentals

Heavy external debt burden

Institutional capacity limitations

Diplomatic balancing between Western and Eastern block 

Moreover, Pakistan must navigate its relations carefully to avoid economic or political isolation from traditional partners while exploring new alignments.

Global Stability: Risks and Prospects

The transition toward a multipolar order is not without risks. Competing power centers may intensify geopolitical rivalries, economic fragmentation, and regional conflicts. However, in the long run, shared global leadership could foster:

More inclusive governance

Reduced unilateral interventions

Greater voice for developing states

For Pakistan, stability will depend on pragmatic diplomacy, economic reforms, and active participation in multilateral platforms.

Conclusion

The expansion of BRICS and the momentum toward de-dollarization symbolize a historic rebalancing of global power. For Pakistan, this transition offers a chance to reposition itself as a proactive stakeholder in a multipolar world. However, benefits will materialize only if Pakistan strengthens its economy, pursues strategic autonomy, and adopts a balanced foreign policy. The emerging world order, therefore, is not merely a challenge—it is an opportunity for recalibration and renewal.