By Shravan Gupta.

War in Ukraine has come as an eye-opener for the modern world. Ukraine, a peace-loving nation, was attacked by Russia on 24th February 2022. The sudden onset of war has impacted greatly in a financial and humanitarian sense. Such an action has been condemned both by the UN as well as WHO and other nations. The Russian aggression has made the world realize the true potential and cost of war on a nation.

In the latest development, Russia has promised to continue the ongoing war at any cost. The world must be prepared to pay the ultimate price as the war in one nation not just impacts that nation but also has a geopolitical impact.

It is a well-known fact that in any war the first impact is felt in terms of financial angle. The world is largely interdependent financially and war cripples the economy of the affected nation. In the long term, it will slow down the economy and inflation will rise. This war is starting to show its impact on the Ukrainian economy. People in Ukraine have run out of money and food as well. War has made an impact on the Russian economy as well. Prominent organizations like the World Bank have condemned the action and downgraded the Russian economy. Russia is facing the prospect of economic sanctions from nations like the US and the UK. Some major companies like Apple and Dell have shut shop and have stopped supplying.

This has also led to a steep increase in oil prices. Hence Europe and the US are undergoing an oil crunch leading to a hike in oil prices. This will lessen the income of consumers making it difficult to procure oil. Market experts have predicted that the economy of the Russian region will shrink by 4.1%. Shravan Gupta feels this can impact the Indian economy as well. India does not rely excessively on oil from Russia hence the impact will be less. But still, it might lead to an increase in overall inflation. Some of such impact is visible now itself.

Apart from the financial angle, there is also the humanitarian angle. War is known to affect men, women and children most. It makes its impact felt in the long run. The world is seeing a huge onset of humanitarian crises. The war in Ukraine has displaced millions of people forcing them to leave homes and seek shelter in neighboring countries. This may lead to a housing and food crisis in Ukraine. A crisis that may take years to overcome. Similarly, the refugee crisis may deepen in countries like Germany with a daily influx of immigrants.

So far there seems to be no end in sight. This makes it an unknown scenario for the world and its future. Shravan Gupta feels financial and humanitarian crises will also lead to alteration of the global economic order and change in payment structure.