Latest news with #Brussels-headquartered
The Print
17 hours ago
- Politics
- The Print
Canada's defence spending declaration is a wake-up call for India. US' credibility is low
The issue came to light when spare parts for Denmark's fleet of stealth F-35 combat aircraft were diverted to Israel, which is in the midst of a brutal assault on Gaza. The argument, and contracted at that, is that spare parts belong to the US Defence Department until they are installed on the planes. All future operating software and such updates also remain the sole property of the US, thus severely undermining individual members' sovereignty, and with the patronising attitude of President Trump acting as a wake-up call, Canada has declared its security intentions clearly and emphatically. This 2006 pledge was repeated in 2014 by NATO Defence Ministers, and remains the essential figure for each member country to spend to make the alliance a formidable and globally employable institution. The Russia-Ukraine war has compounded NATO members' anxieties, but it is the erratic nature of policy formulation in Washington that has finally pushed members over the edge. They can't sit idly and be secure about the viability of the US security umbrella. Even as it questions the commitment of individual members towards NATO, the US has attached bizarre contractual conditions on delivered high-end combat equipment. The magic of collective security can be tossed out of the window in a flash, as Canada has learnt from the mercurial behaviour of United States President Donald Trump. And threats from this 'dangerous and divided world' have led Canada to make an executive declaration — to spend '2 per cent of GDP on defence' by the end of the current fiscal year. In doing so, it will match the basic standard figure expounded by the Brussels-headquartered military collective, North Atlantic Treaty Organisation. Member states, including Canada, pledged in 2006 to hit this figure. Many such powers across the world will have to look within, analyse threadbare, dispassionately, and then predictably come to the same conclusion. That in the current unstable world, made more wobbly by President Trump's policy upheavals, they will also be defined not just by the 'strength of our values, but also by the value of our strength', as current Canadian Prime Minister Mark Carney recently declared. It's obvious, to even the most simple minds, that this can only come from greater defence spending, hence the magic figure of 2 per cent of GDP. This, of course, also includes the overall welfare of soldiers as well as research and development expenditure that contributes to defence. Also read: Victor Gao claims all land north of Ganga for China. People say he's a 'diplomatic fighter' India's position Much has been said about India and its defence expenditure, especially as a percentage of GDP. Like all data-driven debates, analysts are not on the same wavelength when it comes to calculating the precise figures. So if the purpose is to arrive at a reliable figure, in an unsubstantiated environment, it is safest to fall back on the original global institution, the World Bank. And the World Bank chart clearly shows that India's defence spending as a percentage of GDP has been hovering above the magical figure. And has been consistently so for the past few years. India is, of course, the only country that has two nuclear-armed neighbours, both of whom covet Indian territory. It is also the only country that has had armed conflict with these neighbours. And both these countries violate international treaties and norms only to pin down India. This is not an easy task given the current national resolve, emphatically visible during the recently concluded Op Sindoor. Whatever the initial global marketing blitz and hype, post-operation analysis with cool heads has shown reality to be very different. Even the stock market has corrected itself. Global turbulence, and not just of the stock market variety, should, nevertheless, serve as a wake-up call for Indian policy planners to prepare for far greater challenges coming to the neighbourhood. Especially given the fact that the prevailing unity among the democratic order has been subverted. By monetising security agreements at any opportunity, Washington has only lowered its own credibility ratings in the global security sphere. And all this while the world is not sitting idle, especially not those countries that see an opportunity beckoning. For the first time, two Chinese aircraft carriers are now seen operating in different parts of the Pacific Ocean, clearly sending a message as much to Washington as to the rest of Asia. An aircraft carrier, after all, doesn't operate in isolation. It is part of an enormous flotilla of ships, a carrier group in naval parlance. It takes fairly good operational art and extremely impressive military logistics to operate two carrier groups simultaneously. And when deployed in the same oceanic space, it is the simplest message to decipher. As the first part of the Indo-Pacific hyphen, India must lead. Manvendra Singh is a BJP leader, Editor-in-Chief of Defence & Security Alert and Chairman, Soldier Welfare Advisory Committee, Rajasthan. He tweets @ManvendraJasol. Views are personal. (Edited by Theres Sudeep)
Yahoo
31-03-2025
- Business
- Yahoo
Russia's Black Sea ceasefire demands are a 'fools errand' for Trump, major blow for Ukraine
With much fanfare, the U.S. on March 25 announced it had brokered an agreement between Russia and Ukraine to "eliminate the use of force" in the Black Sea after two days of talks in Saudi Arabia. But while Kyiv said it was ready to abide by it straight away, Moscow stalled, insisting the U.S. lift some of the sanctions imposed on it since the start of its full-scale invasion of Ukraine. The Kremlin has innocuously framed its request as a badly-needed boost to its global food and fertilizer trade, largely in the hands of several Russian agro-oligarchs. But experts and officials who spoke to the Kyiv independent said lifting sanctions could in fact help line the pockets of both Russian oligarchs and Moscow's war machine, as well as putting pressure on what has so far remained a largely unified Western sanctions response to Russian aggression. "Any easing of sanctions directly benefits the system fueling Russia's war," a Ukrainian official who works on sanctions told the Kyiv Independent under the condition of anonymity because he wasn't authorized to comment on the issue. "It's impossible to separate Russian oligarchs from their chemical assets — especially fertilizer plants — which are deeply intertwined with the Russian military-industrial complex," they added. When announcing the ceasefire deal, the U.S. said it would "help restore Russia's access to the world market for agricultural and fertilizer exports," but did not provide further details of how this could happen, or if it would involve the lifting of sanctions. Russia's main demand is to lift sanctions on some financial institutions including the state-owned agricultural bank Rosselkhozbank. In addition, it wants other banks related to agriculture to be reconnected to the Brussels-headquartered SWIFT global banking payment system. Russian banks were disconnected from SWIFT after the start of Russia's full-scale invasion of Ukraine in 2022. Despite the Kremlin insisting Russia's global agribusiness needs the boost from eased sanctions, it is in fact already on the up. "An integral part of the Black Sea initiative is the lifting of sanctions on our banking institutions involved in settlements related to agricultural goods," Kremlin spokesperson Dmitriy Peskov told reporters on March 28, Russian state news agency TASS reported. "If European countries refuse to take this step, it means they are not interested in following the path of peace," he added. Russia is one of the top agricultural exporters globally and its food and fertilizer companies were not sanctioned to ensure global food security. Despite the Kremlin insisting Russia's global agribusiness needs the boost from eased sanctions, it is in fact already on the up. Sanctions have made it harder for the sector to secure insurance for shipping and access to finance and machinery, but this has not majorly impacted their agricultural exports increased by 8% in 2023 compared to 2022, and by nearly 10% in 2024. Fertilizer exports dropped by 27% in 2023 compared to 2022 but increased by 15% compared to 2021. In the last year, Russian fertilizer has become even more competitive, thanks largely to cheap gas, Lilit Gevorgyan, Associate Director, Economics at S&P Global Market Intelligence, told the Kyiv Independent. Despite a 30% tariff on Russian fertilizer imports in the EU, they have become increasingly common in the bloc, making up 25% of the market, according to S&P Global Market Intelligence. Read also: As Ukraine, Russia agree to ceasefire at sea, Moscow's battered Black Sea Fleet is set to get a reprieve Moscow's demands are likely less about boosting its agriculture sector and more about overcoming wider financial sanctions, several experts told the Kyiv Independent. Currently, due to being disconnected from SWIFT, Moscow is reliant on the Chinese banking system, although problems emerged last year when Chinese banks began curbing Russian transactions over fears of losing access to the U.S. dollar. Regaining access to the Western financial system would be a major boon for Moscow as all of its major state-owned banks are sanctioned, so they cannot be used for trade or capital operations. The Kremlin likely picked Rosselkhozbank because of its agricultural lending, which fits its narrative around the deal being important for its agricultural sector. However, the state-owned bank is not limited to agribusinesses. If the sanctions against it are lifted, it could lend to anyone while also being used to circumvent other sanctions, launder money, and receive oil export revenues. Russia "needs to have a large state-owned or state-controlled bank outside of the sanctions perimeter," said Alexander Kolyandr, a non-resident Senior Fellow with the Democratic Resilience Program at the Center for European Policy Analysis (CEPA).'That will generally help Russia to reduce risks and prices of imports, facilitate export, and make capital movements easier,' he added. Additionally, while food and fertilizer companies have not been sanctioned, its agro-oligarch owners, such as billionaire fertilizer tycoon Andriy Melnichenko, one of the most important businessmen in Russia with close connections to the Kremlin, have sanctions on Rosselkhozbank are lifted, they would be able to use the bank to move money, get loans, and make potential investments, funneling money into the pockets of businessmen that have fuelled the Kremlin's war machine. Fertilizer companies in particular have sold chemicals to Russia's military industrial complex, such as Melnichenko's company Eurochem, Reuters has previously reported. Russia also wants to get rid of restrictions on European ports that have prevented its vessels from docking, and wants sanctions lifted on ships flying the Russian flag. This would boost Russia's exports and allow its ships to seek maintenance at EU ports. Moscow's final demand is to allow the import of agricultural machinery, like tractors, which have been banned by the U.S. and the EU. Western machinery could improve productivity and revenue for Russian agribusinesses, meaning more money for their oligarch owners. U.S. President Donald Trump sees sanctions as a negotiation tool and threatened Russia with secondary oil sanctions on March 30 for heel-dragging during the peace process. Despite this, the White House has already said it is mulling over lifting sanctions as part of the Black Sea deal, and noted that some of the sanctions Russia wants lifted belong to the EU, not the U.S. Ukraine's Foreign Ministry spokesperson Heorhii Tykhyi said on March 27 that so far, Ukraine and the U.S. haven't agreed to lift any sanctions on Russia. If the U.S. does heed Moscow's demands, Russia will have access to hard currency and a more productive agricultural sector, Gevorgyan said. "The loosening of sanctions will have the very real effect of immediately helping to feed the defense industrial machine within Russia." In turn, this would benefit the oligarchs that have profited off the war, from stealing Ukrainian grain in occupied territories, to selling chemical products to Russia's military sector. "The loosening of sanctions will have the very real effect of immediately helping to feed the defense industrial machine within Russia," Steven Horrel, non-resident Senior Fellow with the Transatlantic Defense and Security Program at CEPA, told the Kyiv Independent. Horrell adds there is also concern that even the lifting of limited and specific sanctions could undermine the entire sanctions regime imposed by Western nations in their support for Ukraine and fight against Russian aggression. Giving in to Putin now would be a "fool's errand" and a "show of weakness" from the U.S., he said, adding it would also destigmatize Russian companies that have stolen from Ukraine and "reward an aggressor for invading its neighbor." Even if the White House eases restrictions, European countries are likely to continue sticking to their guns. "This may be intended to drive a further wedge between the U.S. and Europe", Taisa Markus, adjunct professor at the University of Illinois College of Law, and visiting professor at Kyiv Mohyla Faculty of Law, told the Kyiv Independent. "Even if the U.S. lifts financial sanctions, so long as EU, U.K. and other sanctions remain in place, Moscow is unlikely to gain meaningful access to the global financial markets, and major American financial institutions are likely to remain hesitant to do business with Russia," she added. Read also: Unless you act, 'it's just rhetoric' — Baltic states skeptical of Western European leadership We've been working hard to bring you independent, locally-sourced news from Ukraine. Consider supporting the Kyiv Independent.
