Bengaluru: The Ukraine crisis is a wake-up call for India as it has shown that we cannot rely on others for our energy and security needs, Commerce and Industry Minister Piyush Goyal said on Sunday while addressing the startup awards program in India’s IT capital Bengaluru.
While commending the Indian startups and entrepreneurs for launching innovative solutions during the once-in-a-century crisis caused by the outbreak of the Covid-19 global pandemic, Goyal urged them to innovate in the energy and defense sectors to reduce the country’s dependence on these two critical sectors.
“One can find many opportunities, like even in the current war crisis. The present Ukraine-Russia crisis is a wakeup call for all of us, not to be dependent on crude oil and defense equipment,” Goyal told the audience as the Russia-Ukraine war entered the 18th day on Sunday with no sign of the war getting over anytime soon despite hectic diplomatic efforts and imposition of sanctions against Russia.
Though the war is taking place in Europe, the first war since the end of world war two in 1945, no country in the world is untouched by the adverse economic, political and diplomatic impact of the war.
Humanitarian crisis
Earlier it was a humanitarian crisis as Indian authorities raced against the time to evacuate Indian students stuck in Kyiv, Kharkiv, and Sumy as a significant number of students were studying medicine in Ukraine.
Soaring energy prices
Now, the Indian authorities are grappling with severe economic consequences of the war as within days of the Russian invasion of Ukraine, the Indian basket of crude oil touched $100 a barrel then touched $130 a barrel, the highest in the last 10 years.
The sky-high crude prices have serious economic consequences for a net energy importer like India which imports more than 85% of its crude oil requirement and over half of the gas requirement from abroad.
In response to the Russian invasion, the US, European countries, and their allies have imposed harsh sanctions against Russia which makes it difficult for other countries to trade with the Russian Federation.
Sanctions may derail Russian defence supplies
The threat of Western sanctions against Russia was already a risk factor for a country like India as it heavily relies on Russian defense equipment, which includes modern battle tanks such as T-72 and T-90, frontline fighters such as Sukhoi-30 MKI and Mig-29 jets, and Kilo-class submarines.
Even before the Russian invasion of Ukraine, US authorities were debating whether to offer India a waiver for the country’s purchase of the S-400 anti-ballistic missile defense system from Russia.
The USA has imposed sanctions against several countries, including Turkey, for buying sophisticated weapons from Russia under its Countering America's Adversaries Through Sanctions Act (CAATSA).
Fresh sanctions imposed by the Western countries will pose new challenges in the delivery of Russian S-400 missile defense batteries to India and supply of spare parts for already inducted defense equipment will also become difficult.
