The end of the First Cold War in 1991 was significant. The Soviet Union broke up, the US claimed victory in an instant Francis Fukuyama called “the end of history”, and India embraced market reforms in a move inspired by the oil-shocks of the Gulf War, but with the benefits of an open economy. Clarity supported. Otarki. Does the start of Cold War II, as Russia’s invasion of Ukraine foreshadows, marks a ‘return of history’ that could call for another major strategic shift? On Tuesday, US President Joe Biden’s state-of-the-Union address demanded America’s “resolve that freedom will always triumph over tyranny”, as an example of Russian aggression that had to be defeated. The US-led West’s arsenal is made up of sanctions aimed at stifling the economy of Russia, which had integrated itself with the Western world over three decades. Clamps on reserves held in the West by Russia’s central bank deprived Moscow of currency recourse as money began to run out, its ruble cleared, imports turned into inflation and asset values fell. Was; Rate hikes and capital controls may be unable to restore stability. Still, we’ve seen no sign of a Kremlin back-down, despite the swamp it may see itself in Kyiv, and domestic discontent fueled by financial difficulties may take too long to shake its authority. Crucially, Russia could differentiate itself from the West at a cost lower than the US estimates.
If global geopolitics is much different from what it was 30 years ago, the rise of China is a big reason. Pre-invasion talks between Moscow and Beijing had brought the two closer to each other. Blocking large Russian banks from the main mechanism for the movement of money around the world has since turned Russia’s interests into the activation of alternatives with China that could bypass US-imposed sanctions. Technology supporters are there. In some ways, crypto transfers have already put the old system on notice, and a Chinese-powered digital yuan is being given a role that is not beyond the realm of plausibility. While the scope of thwarting cooperation in the great Asian territorial waters remains hazy, its very prospect could deter Russia from using the oil-export embargo as a retaliatory weapon, given China’s vulnerability to it. The stance adopted by OPEC, the world’s original oil arsenal, which influenced the massive price rise in 1973, could also prove to be important. After Moscow’s recent attempt to play its own game met with a glut of Saudi oil, which reduced its revenues in compliance with the cartel’s calculus, OPEC+ has been mired in an uneasy struggle, but the club’s unity over The impact of the Ukraine war condemns easy analysis.
No less in the thick fog of war, there were talks of Pakistan with Russia soon after the start of hostilities. While Moscow’s relations with Islamabad have warmed and cooled over the years, our neighbor’s tilt away from the West – a bet on Chinese dominance in Asia to come – is visible in the grim episode of the US withdrawal from Afghanistan. Was. There has also been speculation that a new Ocus coalition of Australia, the UK and the US will take over the task of the four-way quad, aimed at humiliating China. All these developments may make us wonder whether New Delhi’s longstanding neutrality is the best way to secure our future as this Second Cold War worsens. As we found after 1991, the Western model is a good assurance of prosperity. But we live in Asia. And the ruling on safety means that we must hedge our bets. let’s be non-aligned
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