Indian Defence Review

The Russia-Ukraine conflict has arrived at an alarming juncture. On 30 Sep Russia announced the merger of Luhansk, Donetsk, Zaphorizhia and Kherson. Going by territorial outcomes, Russia, with the annexation of these eastern parts of Ukraine i.e. 15 percent of territory that it vied for on the basis of ethnic affinity, is in a position of strength.

Do or Die Situation

Russia, in a sense, has thrown the gauntlet at the NATO. If Ukraine with the aid of NATO is unable to reverse the outcome, it will add to the ignominy that it suffered at the hands of Taliban in Afghanistan. The consequent degraded image will certainly and adversely impact the cohesiveness of the organization. After all the most ostensible and contentious reason for the conflict is over the drift of Ukraine into the NATO orbit, no less induced by the latter.

Geopolitically, the Russians construed the drift as pernicious. Hence, the conflict is a do or die situation for Russia, more precisely Putin, as well as NATO. Putin has ordered mobilization, probably for a broader and stronger counter offensive, probably as a precaution against protracted conflict. In case these measures were to fail, the nuclear option cannot be ruled out.

Divisions Within

So far Putin has not strayed from vertical escalation, but, if cornered, may resort to horizontal escalation. As compared to the NATO, Russia is better placed to exercise this option, given the fissures in the NATO countries on the issue of escalation. There are several member countries who have been advocating that the key Russian strategic and geopolitical concerns should be accommodated to prevent further escalation. European Council on Foreign Relations(ECFR) held a survey to ascertain the concerns and attitudes of Europeans with regard to dealings with Russia i.e. whether to sue for PEACE or pursue the course of PUNISHMENT. The results in the ten countries that were surveyed was overwhelmingly in favour of PEACE. The manner in which different nationalities responded in percentage terms are:

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Poland and Pipeline

What can be inferred from the above data is that the most strident anti-Russia narrative is in Poland, an erstwhile Warsaw Pact country. It may also be mentioned Poland and Russia share a 232 km (210km long and 22km sea) border, by virtue of Russia’s Kaliningrad exclave, and not with the Russian mainland. Poland has apprehensions that following Crimea which Russia annexed in 2014, it very much could be the next victim, given the Russian military presence in Kaliningrad Oblast.

Moreover, the Soviet era Druzbha overland pipeline between Russia and Europe passes through Poland It is one of the largest and oldest pipelines in the world with a capacity to pump more than 2 million barrels per day. The pipeline has two legs , one that goes to Germany via Poland and other to Slovakia, Hungary and Czech Republic. Considering the criticality of Poland pipeline geopolitics, rather the energy war, involving Russia and the West, it must be subject to massive pressures and manipulations by the US lead NATO, with the objective that the overland route dries up and energy the energy orientation of Europe faces West. These may be the reasons for large number of Polish being votaries of PUNISHMENT to Russia.

The Baltic Factor

The Kaliningrad exclave was acquired by the Soviet Union after the second world war and has great strategic value as it is close to rest of Europe and it provides a warm water port for its Navy and trade through the Baltic Sea. Denmark, Sweden, Finland, Russia, Eastonia, Latvia, Lithunia, Poland and Germany are the countries that bound the Baltic sea. The larger Baltic Region comprises Norway and Iceland as well. The 1200 km Nord stream pipeline, both 1 and 2, between Russia and Germany passes through the Baltic Sea. Together Nord stream , 1 and 2, was envisaged to supply 110 cubic meters of gas every year. This would have further increased the dependence of the European gas from the present 40 percent. This also has the potential to make the Russia-Europe pipeline redundant.

Ukraine, before the conflict was earning as much as $ 3bn per year as transit fee. Strategically, the Nordstream would be catastrophic for US and reasons the NATO. Nordic countries like Sweden and Finland are extremely keen to join the NATO. If that concludes the entire security landscape of Europe and consequently the threat perception of Russia will change. Russia’s borders with NATO countries would double. Both Sweden and Norway are citing Russian invasion of Ukraine as the plea for joining NATO, but the reality is the first move on the strategic chess board was made by the US when it engineered the exit of the duly elected Ukrainian president Viktor Yanukovych in 2014. This actually heralded the Russo-Ukrainian conflict.

Vertical and Horizontal Escalation

Though the military escalation has been vertical ,but the underlying economic warfare is horizontal. Russia has increasingly resorted to weaponising of energy, specially gas, against heavily dependent European countries. Food and fertilizers are also being weaponised. It may be reiterated that together Ukraine and Russia account for 27 percent of the world’s global wheat exports. There are at least 25 African countries which are dependent to between one-third and half for their wheat consumption. For Lebanon the dependence is as much as 80 percent.

In addition Russia is also the major exporter of fertilizers i.e. potash, ammonia and urea. Ukraine on the other hand is the largest exporter of sun flower oil and in the case of corn it occupies the fourth place. The ripples of global food insecurity caused by the conflict is being felt in the US as well.

The Organization of Economic Cooperation and Development (OECD) countries has some very scary forecast for the global economy. It says that global economy growth may come down to 2.9 percent in 2023 and in the worst case scenario to even one percent. The IMF more or less suggests the same worrisome figures. Global inflation the IMF says could reach as high as 8. 8 percent.US and Europe may be the worst sufferers. The economic offensive by the NATO countries is thus having a blow back effect. As per one estimate the war will cost $ 3 trillion, almost to the tune of entire size of Indian economy.

Demographic Impact

The sociological and demographic impact of the conflict is massive. Nearly 50 lakhs Ukrainians, predominantly women and children have taken shelter in Europe of which 50 percent are in Poland. Consequently the population of Poland has gone up by 17 percent. The other countries that they have found refuge are: Poland, Czech Republic, Slovakia, and Hungary. The conflict has turned them from outmigration to immigration countries. Since the beginning of the conflict more than a quarter of 4.5 crore Ukraine population has been forced to move out of the country. The longer the war persists, the lesser would be the chances of refugees to return. It will also compel those men to join their families abroad, who stayed back to fight the Russians.

Erosion of American Influence

The US has immense coercive power, and yet many important countries have directly or indirectly leaned towards Russia. In this case the erstwhile American threat “either you are with us or against us” is not working. Multiple times at the behest of the US, resolutions against Russia has been sponsored in UN General Assembly. With each successive voting the numbers in favour of Russia, directly or indirectly is increasing. In March, in the wake of invasion,143 countries out of 193 voted against Russia, in April it came down to 93 . In October recently though 143 countries voted against Russia, the 35 abstentions were notable. It included strategically important countries like India, Pakistan and Vietnam.

The US had to exert pressure on countries such as Nepal and Sudan to vote in favour of resolution. Much to the chagrin of the US, the OPEC plus, led by Saudi Arabia has decided to cut its oil production by 2 million barrels, which is bound to drive the prices higher and mitigate the sanctions on Russia. This is despite the fact Saudi Arabia is dependent on the American security umbrella. The OPEC is guided by purely economic reasons while the US sees the decision through geopolitical and electoral considerations, since the mid-term elections are going to be held on 8th November for 435 seats in the House of Representatives and 35 of the 100 seats in Senate. The OPEC was compelled because the prices had almost plummeted below the break-even cost.

Also, given the Ukranian conflict, there is churning in global energy politics. It is quite possible that the US may unshackle Venezuela to meet the oil demand. Libya may just be facilitated to ratchet production. Owing to the Russia-Ukraine conflict the global oil market has become highly unpredictable.

The conflict has injected new life into the American and European arms industry which had become listless due to the Covid pandemic. Till July 2022NATO countries had sent arms worth $ 8 bn into Ukraine. The US has declared its intent to further infuse $9bn arms into Ukraine.

Conflict Profiteering

Raytheon and Lockheed Martin have sold 6500 Javelin anti-tank missiles. Each missile costs$78000. Raytheon has supplied 1400 Stinger missiles. The contract is worth $ 625 mn. Germans have announced their decision to buy 35 F-35 aircraft which has a life time cost of $1.6 trillion. Thales is to supply next generation anti-tank weapons. It’s shares have gone up by 35 percent. BAE is providing huge quantities of ammunition. It’s shares have gone up by 32 percent. The shares of Lockheed Martin have gone up by 14 percent. Rhinenetall which manufacture tanks and artillery, it’s shares have gone up by 25 percent. The US has promised to supply Switch Blade Aerial System,-. Kamikaze Drones. These are some examples.

Most NATO countries have announced their decision to substantially increase their dedence budget as percentage of GDP. America is hardly a nation, it state or combination of states, and it is the military-industrial complex that runs the state, and the oil industry and arms industry is at the center of it. Notwithstanding the food created by the conflict, food insecurity giants like ADM, Bunge, Cagrill and Louis Dreyfus have posted huge profits.

Conclusion

The best yardstick to decide who the real aggressor is to determine who profits from the war. The rise of the US as a superpower was propelled by its profiteering in the two World Wars. The military-industrial complex since then has continuously re-invented itself to sustain the superpower status. Will it be able to do the same this time too?