On 16 June 2020, a former Chief Economist of the World Bank, Kaushik Basu, made an interesting observation on his Twitter account. It read: “When the Indian Ambassador to the USSR showed Stalin the map of India, Stalin pointed to Sri Lanka and asked, ‘What is the name of this tiny Indian island?’ The Ambassador said, ‘This is not an Indian island. It is Sri Lanka, an independent nation.’ Stalin looked puzzled: ‘Why?’” It is Sri Lanka’s good fortune that India has not had the same imperialistic compulsions as Russia and instead been a friendly neighbour over many millennia.
Basu’s Tweet encapsulates the imperialist mindset of Russian leaders then and now. It appears that the desire to attempt a reconstruction of the once-mighty Soviet Union is no longer a figment of Western imagination if the Ukraine invasion is anything to go by, and in fact US President Joe Biden said as much during a media conference last week. Russian President Vladimir Putin, who has turned out to be quite the enigma during his lengthy tenure in office, which he technically can extend till 2036, appears to be spearheading that project and has by default become the face of the latest version of age-old Russian imperialism.
That is not to say that Russia lacked justification for last week’s invasion of neighbour Ukraine, with NATO being less than subtle in its attempts to woo the former Soviet nation to its fold, but whatever issues it had should first have been pursued on the diplomatic front and full-scale war should have been the very last resort, if at all. Given that World War Two sparked off under similar circumstances, when Hitler’s Germany invaded Ukraine’s neighbour to the north, Poland, in 1939, it served as justifiable grounds for the almost universal condemnation of the Russian aggression.
The BBC’s Moscow Correspondent Steve Rosenberg offered a more holistic view of the Russian President’s motives: “Vladimir Putin is fuelled by resentment at how the Cold War ended, with the West declaring victory and Russia losing power, influence and territory. If you’ve been in power for 22 years, as Putin has, you start to feel invincible; you start to think you can’t put a foot wrong, that you’re Teflon. And that’s when mistakes start to creep in. Just from speaking to people on the streets (of Moscow) and witnessing the strength of feeling against this offensive, I wonder whether this invasion will turn out to be Putin’s fatal error.” Whether Rosenberg is right, only time will tell.
The West, which has long been suspicious of Putin, has finally had occasion to publicly air its suspicions. UK Defence Secretary Ben Wallace told the media on Friday: “Russia won’t stop after Ukraine. Putin is not rational. He doesn’t believe the Baltic States are really countries. We all have to stand up to him.”
What these developments portend is a protracted conflict that could potentially drag on for years. While a few economies will thrive – like the merchants of death peddling arms – others which form the majority will suffer. Even if a ceasefire were to be negotiated in the coming days or even if the Russians were to withdraw back to base, the invasion has cast the die for a new, more aggressive and lethal, no-holds-barred ‘smart’ version of a modern-day Cold War. The inevitable outcome of such an eventuality will be countries, especially those dependent on others for sustenance, having to pick sides.
This is where countries like Sri Lanka will be faced with the prospect of having to make hard choices and then be prepared to live with the consequences of those choices. However, for the time being at least, the Government will have to draw upon all its foreign policy expertise to manage the emerging policy crisis, as both protagonists form an important part of the nation’s economic architecture. Already tensions seem to be rising on the local front, with Ukrainians in the country protesting in front of the Russian Embassy in Colombo and anti-Russian sentiment among the local community noticeably on the rise.
Since the ’70s Sri Lanka has been a leading proponent of a non-aligned foreign policy that has served it well even during times of adversity. However, of late, economic exigencies have propelled the nation into the orbit of various power bases exposing it to geopolitical manipulation unlike ever before. Given the evolving situation and what is at stake, delicate yet astute diplomacy is the need of the hour. As to how long it can stay indifferent to the rapidly-strengthening geopolitical currents, given the Government’s almost total dependence on external funding resources with a sinking economy on its hands, is now the billion-dollar question.
If recent events are anything to go by, walking the tightrope is not the strong point of the current administration. Whether the Government’s foreign policy apparatus will be up to the task of escaping the cross-currents is a matter for conjecture at this point, given the economic need-based diplomacy rather than non-alignment being the order of the day. For all intents and purposes Russia is being touted as the new pariah on the international stage by the West while the two nations Sri Lanka seems to be most dependent on these days for economic emancipation – China and India – have been maintaining radio silence on the matter while finding themselves on the same side in abstaining to vote against Russia in a West-inspired Resolution at the United Nations Security Council. Russia eventually, as expected, vetoed the Resolution.
Three days into the full-blown war, the Foreign Ministry has managed to maintain radio silence on the matter, but as to how long it can continue to do so in the face of mounting pressure from the West is left to be seen. It is moot that even though funding to stay afloat in the current circumstances is likely to come from India and China, the main markets for all our export merchandise that account for the bulk of foreign revenue receipts is the West, meaning the US and EU. That is not to discount both Russia and Ukraine, which collectively account for exactly one-fourth or 25% of the 160,000 tourists who have arrived in the country so far this year, while also accounting for over 15% of the $ 1.3 billion worth of tea exports last year, which is now as good as gone in light of the harsh economic sanctions that are in place.
Within hours of the invasion it was reported that $ 250 billion had been wiped off the Russian stock market. Russian billionaires are said to have lost an estimated $ 125 billion in the first few days of war as a result of market shocks, while the impact of economic sanctions will have to be factored in later. To put the numbers in context, Sri Lanka’s entire foreign debt stock currently stands at around $ 50 billion while national GDP is around $ 81 billion.
The implications of a weaker Russian economy will have global ramifications and its fallout will filter down faster to its trading partners. Therefore, Sri Lanka will have no option but to find alternative markets for its tea as well as alternative source markets for tourism. This dual shock, coupled with the oil price escalation, will land the administration from the frying pan into the fire in a scenario where inflation is already at a record high, the Government’s intended revenue booster – the proposed Goods and Services Tax – has virtually been shot down by the Supreme Court, and lengthening power cuts are eating into production. The administration now has no option but to go back to the drawing board and recalibrate its economic strategy.
Patience and prudence, both of which unfortunately are in short supply these days – patience due to economic compulsions on the ground and prudence due to a litany of bad calls on important issues in the recent past – are nevertheless the need of the hour for the nation’s safe passage through the evolving global crisis.
Prudence – the need of the hour
26 Feb 2022
Prudence – the need of the hour
26 Feb 2022
On 16 June 2020, a former Chief Economist of the World Bank, Kaushik Basu, made an interesting observation on his Twitter account. It read: “When the Indian Ambassador to the USSR showed Stalin the map of India, Stalin pointed to Sri Lanka and asked, ‘What is the name of this tiny Indian island?’ The Ambassador said, ‘This is not an Indian island. It is Sri Lanka, an independent nation.’ Stalin looked puzzled: ‘Why?’” It is Sri Lanka’s good fortune that India has not had the same imperialistic compulsions as Russia and instead been a friendly neighbour over many millennia.
Basu’s Tweet encapsulates the imperialist mindset of Russian leaders then and now. It appears that the desire to attempt a reconstruction of the once-mighty Soviet Union is no longer a figment of Western imagination if the Ukraine invasion is anything to go by, and in fact US President Joe Biden said as much during a media conference last week. Russian President Vladimir Putin, who has turned out to be quite the enigma during his lengthy tenure in office, which he technically can extend till 2036, appears to be spearheading that project and has by default become the face of the latest version of age-old Russian imperialism.
That is not to say that Russia lacked justification for last week’s invasion of neighbour Ukraine, with NATO being less than subtle in its attempts to woo the former Soviet nation to its fold, but whatever issues it had should first have been pursued on the diplomatic front and full-scale war should have been the very last resort, if at all. Given that World War Two sparked off under similar circumstances, when Hitler’s Germany invaded Ukraine’s neighbour to the north, Poland, in 1939, it served as justifiable grounds for the almost universal condemnation of the Russian aggression.
The BBC’s Moscow Correspondent Steve Rosenberg offered a more holistic view of the Russian President’s motives: “Vladimir Putin is fuelled by resentment at how the Cold War ended, with the West declaring victory and Russia losing power, influence and territory. If you’ve been in power for 22 years, as Putin has, you start to feel invincible; you start to think you can’t put a foot wrong, that you’re Teflon. And that’s when mistakes start to creep in. Just from speaking to people on the streets (of Moscow) and witnessing the strength of feeling against this offensive, I wonder whether this invasion will turn out to be Putin’s fatal error.” Whether Rosenberg is right, only time will tell.
The West, which has long been suspicious of Putin, has finally had occasion to publicly air its suspicions. UK Defence Secretary Ben Wallace told the media on Friday: “Russia won’t stop after Ukraine. Putin is not rational. He doesn’t believe the Baltic States are really countries. We all have to stand up to him.”
What these developments portend is a protracted conflict that could potentially drag on for years. While a few economies will thrive – like the merchants of death peddling arms – others which form the majority will suffer. Even if a ceasefire were to be negotiated in the coming days or even if the Russians were to withdraw back to base, the invasion has cast the die for a new, more aggressive and lethal, no-holds-barred ‘smart’ version of a modern-day Cold War. The inevitable outcome of such an eventuality will be countries, especially those dependent on others for sustenance, having to pick sides.
This is where countries like Sri Lanka will be faced with the prospect of having to make hard choices and then be prepared to live with the consequences of those choices. However, for the time being at least, the Government will have to draw upon all its foreign policy expertise to manage the emerging policy crisis, as both protagonists form an important part of the nation’s economic architecture. Already tensions seem to be rising on the local front, with Ukrainians in the country protesting in front of the Russian Embassy in Colombo and anti-Russian sentiment among the local community noticeably on the rise.
Since the ’70s Sri Lanka has been a leading proponent of a non-aligned foreign policy that has served it well even during times of adversity. However, of late, economic exigencies have propelled the nation into the orbit of various power bases exposing it to geopolitical manipulation unlike ever before. Given the evolving situation and what is at stake, delicate yet astute diplomacy is the need of the hour. As to how long it can stay indifferent to the rapidly-strengthening geopolitical currents, given the Government’s almost total dependence on external funding resources with a sinking economy on its hands, is now the billion-dollar question.
If recent events are anything to go by, walking the tightrope is not the strong point of the current administration. Whether the Government’s foreign policy apparatus will be up to the task of escaping the cross-currents is a matter for conjecture at this point, given the economic need-based diplomacy rather than non-alignment being the order of the day. For all intents and purposes Russia is being touted as the new pariah on the international stage by the West while the two nations Sri Lanka seems to be most dependent on these days for economic emancipation – China and India – have been maintaining radio silence on the matter while finding themselves on the same side in abstaining to vote against Russia in a West-inspired Resolution at the United Nations Security Council. Russia eventually, as expected, vetoed the Resolution.
Three days into the full-blown war, the Foreign Ministry has managed to maintain radio silence on the matter, but as to how long it can continue to do so in the face of mounting pressure from the West is left to be seen. It is moot that even though funding to stay afloat in the current circumstances is likely to come from India and China, the main markets for all our export merchandise that account for the bulk of foreign revenue receipts is the West, meaning the US and EU. That is not to discount both Russia and Ukraine, which collectively account for exactly one-fourth or 25% of the 160,000 tourists who have arrived in the country so far this year, while also accounting for over 15% of the $ 1.3 billion worth of tea exports last year, which is now as good as gone in light of the harsh economic sanctions that are in place.
Within hours of the invasion it was reported that $ 250 billion had been wiped off the Russian stock market. Russian billionaires are said to have lost an estimated $ 125 billion in the first few days of war as a result of market shocks, while the impact of economic sanctions will have to be factored in later. To put the numbers in context, Sri Lanka’s entire foreign debt stock currently stands at around $ 50 billion while national GDP is around $ 81 billion.
The implications of a weaker Russian economy will have global ramifications and its fallout will filter down faster to its trading partners. Therefore, Sri Lanka will have no option but to find alternative markets for its tea as well as alternative source markets for tourism. This dual shock, coupled with the oil price escalation, will land the administration from the frying pan into the fire in a scenario where inflation is already at a record high, the Government’s intended revenue booster – the proposed Goods and Services Tax – has virtually been shot down by the Supreme Court, and lengthening power cuts are eating into production. The administration now has no option but to go back to the drawing board and recalibrate its economic strategy.
Patience and prudence, both of which unfortunately are in short supply these days – patience due to economic compulsions on the ground and prudence due to a litany of bad calls on important issues in the recent past – are nevertheless the need of the hour for the nation’s safe passage through the evolving global crisis.
Kapruka
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Discover Kapruka, the leading online shopping platform in Sri Lanka, where you can conveniently send Gifts and Flowers to your loved ones for any event. Explore a wide range of popular Shopping Categories on Kapruka, including Toys, Groceries, Electronics, Birthday Cakes, Fruits, Chocolates, Automobile, Mother and Baby Products, Clothing, and Fashion. Additionally, Kapruka offers unique online services like Money Remittance, Astrology, Medicine Delivery, and access to over 700 Top Brands. Also If you’re interested in selling with Kapruka, Partner Central by Kapruka is the best solution to start with. Moreover, through Kapruka Global Shop, you can also enjoy the convenience of purchasing products from renowned platforms like Amazon and eBay and have them delivered to Sri Lanka.Send love straight to their heart this Valentine's with our thoughtful gifts!