Dr Hasnain Javed<\/p>\n
Many of Asia\u2019s important actors are now on the verge of being lured into an expensive and deadly arms race<\/p>\n
The Russia-Ukraine conflict jolted the world, in the aftermath of the events economies around the globe are now facing the real impact of Putin\u2019s Demilitarization. For Pakistan, it is not only felt through the sharply rising fuel prices and an aggressively climbing inflation but also as increased political pressure from global powers.
\nThe isolation of the world\u2019s 11th-largest economy, on the other hand, has immediate global consequences, including rising inflation, stagnant growth, and financial system upheaval. The Russia-Ukraine unfortunate turn of events has unfolded a grand saga of political loyalties and hidden economic benefits. As India\u2019s stance confused its quad partners, China maintained its silence, the US and the NATO allies continue with the sanctions \u2013 the global economic landscape is forever changed.
\nEurope is a significant destination for Russia\u2019s energy exports, accounting for approximately 49 per cent of its crude oil and condensates and 74 per cent of its natural gas. Europe is, in a nutshell, Russia\u2019s main energy buyer. The bulk of crude oil exported from Russia went to the Netherlands, Germany, and Poland, whereas the majority of natural gas exported from Russia went to Germany, Turkey, Italy, and France. Yes, Europe is extremely reliant on Russia for energy, and decreasing that reliance will not be easy. As a result, the first and foremost economic impact is felt by European countries.
\nAs the global geopolitical economic influence evolves due to shifting dynamics between China and the United States, as well as the tensions in the Middle East, enterprises and investors have persevered in the face of hardship and maintained corporate dreams. However, the commodity shock of not only the energy products but of key industrial metals such as nickel, aluminium, and palladium as well as wheat and potash will have a greater long-term effect as they begin to unravel.
\nMy major concern here is if Russia concedes, which, at this point, seems like a major likelihood, it will reinforce the American influence and unilateralism not only on Russia but also on its allies. Under which, Pakistan may be in hot waters. As witnessed in the FATF\u2019s decision to keep Pakistan on the grey list and our reliance on the IMF program, we may be once again forced to rethink our alliances and priorities. What remains to be seen is how will it pay for India\u2019s selective and calculated neutrality? With the US hinting at \u201cregional and global consequences,\u201d the message could not have been any clearer.
\nEconomic penalties levied against Russia may also jeopardise other projects being considered between Russia and Pakistan as part of the \u201cCooperation Roadmap 2021-26.\u201d This will have an effect on the supply and maintenance of transport aircraft and helicopters, the renovation and repair of Pakistan\u2019s railways, the development of industrial facilities, including upgrades, in the metallurgy, chemical, and pharmaceutical industries, and power engineering. It will also have a detrimental effect on Pakistan\u2019s army\u2019s tank modernisation programamme and the Pakistan Air Force\u2019s IL-78 aircraft overhaul. The USD 2.5 billion Pakistan stream gas pipeline project may potentially be delayed.
\nFor its part, experts believe that by remaining neutral and finalising long-term agreements in LNG, LPG, and crude oil at competitive prices to meet its energy needs, Islamabad will have an opportunity to strengthen bilateral ties with Moscow while also enhancing its bilateral ties with the United States. However, Pakistani leadership will be walking a thin line in maintaining a balance between Russia and the US.
\nAnother emerging aspect of the Russia-Ukraine conflict is that it may trigger a Nuclear Arms Race in the Asian region. According to a December report by the US Department of Defense, China aims to treble its nuclear arsenal by 2027 and collect 1,000 warheads by 2030.
\nChina will undoubtedly strengthen these efforts in the aftermath of the Ukraine war. It undoubtedly possesses the resources necessary for a significant armaments build-up. And, with Putin issuing nuclear threats and Taiwan tensions escalating, the strategic imperative is stronger than ever.
\nHowever, China\u2019s nuclear program will continue. Also, many of Asia\u2019s important actors are now on the verge of being lured into an expensive and deadly arms race that will erode the region\u2019s security. India, China\u2019s regional opponent, will attempt to increase its nuclear arsenal, prompting Pakistan, India\u2019s nuclear-armed adversary, to do the same. The economic impact of which may be too much for Pakistan\u2019s fragile economy.
\nRussia, economic gurus believe, is doomed, and the default is viewed as a matter of when not if. The all-too-obvious expectation is that sanctions would wreak such economic havoc on Russia that they will almost certainly spark an internal uprising or coup, which will then pave the way for a long-awaited regime change.
\nWith a bleak future predicted for Russia, the political and economic experts in Pakistan must brace themselves for an economic impact unseen and not experienced in the country\u2019s history before.<\/p>\n","protected":false},"excerpt":{"rendered":"
Dr Hasnain Javed Many of Asia\u2019s important actors are now on the verge of being lured into an expensive and deadly arms race The Russia-Ukraine conflict jolted the world, in the aftermath of the events economies around the globe are now facing the real impact of Putin\u2019s Demilitarization. For Pakistan, it is not only felt […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10],"tags":[5304,1555,5303],"class_list":{"0":"post-251154","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-article","7":"tag-demilitarization","8":"tag-dr-hasnain-javed","9":"tag-economic-face"},"yoast_head":"\n