India got lifeline from Russia-Ukraine War, now it is becoming an alternative to China - Newztezz Online


Thursday, May 11, 2023

India got lifeline from Russia-Ukraine War, now it is becoming an alternative to China

More than a year has passed since the ongoing war between Russia and Ukraine. This war has made a lot of changes at the level of the global economy. India has benefited from this and China is getting sidetracked.

The war that broke out between Russia and Ukraine has been going on for more than a year, there is no immediate solution to this war and it has become difficult to predict which stand both the countries will take next. Meanwhile, it has had a great impact on the world economy. However, India has seen this 'disaster as an opportunity' by buying cheap crude oil from Russia. But the benefit of India from the Russia-Ukraine war is limited to this…?

The war between Russia and Ukraine has benefited India in other ways as well. Many of these cases are such that India is moving ahead leaving China behind. However, it has also suffered some losses.

India moving ahead of China

Russia-Ukraine war has done the work of changing the thinking of the western world about India first. In fact, after this war, the western world is now looking at India as a capable partner instead of China. From manufacturing to supply of pharma and special chemicals, western countries are now working on the strategy of 'China + 1'. India is the most important partner in this.

Not only this, be it manufacturing of Apple or making of semiconductors, western countries are now understanding India's potential. While many companies are also turning to India for manufacturing low cost goods.

In this regard, Jim O'Neill, author of the BRICS report, says that India's demographic status shows that its economic growth rate can leave behind even 10 percent in the coming decade, but India will have to make many major reforms.

Due to Russia and Ukraine war, the world is slowly getting cut off from Russia and China, so good investment is expected in India in 2023. Anyway, now India has become the most populous country in the world, leaving behind China, which makes India a big market.

Difficulties created by the Russia-Ukraine war

The Russia-Ukraine war has also created many difficulties for India. For example, after the start of the war, India's oil import bill increased for 6 months. Then the price of crude oil had reached $110 per barrel. Later, buying cheap oil from Russia, India is now exporting refined petrol and diesel to Europe.

But this war left no stone unturned in increasing the inflation inside the country. Because of this, India's fertilizer import bill also increased and the subsidy burden on the government. According to the Fertilizers Association of India, the subsidy budget for fertilizers is estimated to increase from Rs 1.1 lakh crore to reach Rs 2.3 lakh crore at the end.

This war has also increased the prices of wheat worldwide, because both Russia and Ukraine are big exporters of wheat. This had an effect on inflation and RBI had to increase interest rates to control it. As a result, the country has seen the situation of 'high inflation, low growth' in the last one year.

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