Last few years has been challenging for Economies world over. First it was Covid-19 Pandemic which had derailed the growth trajectories of the developed and emerging economies world over. Such was the body blow of Covid-19 pandemic that many developing countries got them embroiled in huge debt trap, because their Industrial Output and revenue sources had come to a grinding halt and had dried up.
Russia-Ukraine war has slowed down global recovery
In 2022, Nations all over the world were looking forward to a new lease of economic life as they believed that they had tamed the deadly virus. However, their hopes were belied as Russia invaded Ukraine, which has adversely impacted the global economic recovery.
In the beginning of the Russian – Ukrainian conflict, it appeared that Russia would steamroll and defeat Ukrainian forces in a matter of weeks. However the resilience of Ukrainian people has surprised many.
Russia-Ukraine conflict has become a geopolitical quagmire and quicksand with Nato and US solidly backing Ukraine by supplying hi-tech arms to take on the rampaging Russian Army. However Russian strongman Vladimir Putin is adamant and is determined not to back down despite sanctions and setbacks suffered by the Russian Economy.
Economic recovery of world is at a standstill and in India’s immediate neighborhood Pakistan and Srilanka have slipped into high debt crisis. Russian – Ukrainian conflict has severely impacted the agriculture in Asia , Africa and emerging economies.
Impact of Russia Ukraine Conflict
Food Security
Russia and Ukraine are considered to be the granaries of the world and are predominant suppliers of high quality and nutritious wheat of developing and developed world. However, due to raging conflict supply of wheat to countries in Asia , Africa and Latin America has come to grinding halt. Prices of wheat has touched the roof world over and has caused food insecurity in the developing economies
Fertilizer becomes scarce
Russia and Ukraine are also the leading suppliers of Fertilizers to third world countries. Due to war the supply of fertilizers has been adversely impacted and farm and agricultural output world over is bound to plummet.
Europe on the Knees
Russia was the largest supplier of Natural Gas to Europe. Due to sanction regime and attitude adopted by European countries, the powerhouse economies of Europe and Germany have been forced to look for other sources for natural gas supplies. Cost of living and Inflation in Europe at record high and Annual growth has slumped in the Negative zone.
Petroleum
Russia is the largest producer of oil and Western countries have adopted various measures to stop the supply of Russian Oil to countries world over. However, the impact of non-availability of Russian Oil is impacting the emerging economies world over and they are forced to procure oil at sky high price which has resulted in retail inflation touching a new high. Due to this the cost and price of essential commodities has also become expensive and has proved dampener for economic recovery which emerging economies worldover.
Also Read: Finance officials should draw inspiration from ‘vibrancy of the Indian economy’: PM modi at G20 meet
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