Global Turmoil

by Murali Gopalan 30 Mar 2022


Photo courtesy by prokerala.com

After two years of the pandemic, when it seemed as if the worst was over, Vladimir Putin decided that it was time to give the world a jolt. 

The Russian President assumed that Ukraine would be a cakewalk except that the war continues and his country has pretty much been ostracised by the global community.

The problem is that this move will have its consequences across the world. Oil prices have predictably risen but the bigger issue is a food crisis that could impact Africa and parts of West Asia. Ukraine is an important supplier of wheat and the Russian invasion has ensured that its availability will be severely impacted in the process. 

The likelihood of many parts of the world going hungry is not a happy thought and it is now apparent that retaliation by way of trade sanctions can hurt as much as a physical conflict using dangerous weapons. This war will cost Russia dearly and could even set it back by a decade in terms of economic growth. The bad news is that in a globalised world, it will affect a host of other countries too.

The auto industry is already concerned about a possible shortage of key components that go into catalytic converters and electric vehicles. It is not as if a solution can be found immediately either since the whole exercise of becoming self-sufficient takes time. 

India has articulated such an intent too in its Atmanirbharta slogan but China still takes up a large chunk of our imports basket. This is what global trade is effectively about and the war in Ukraine will just end up snapping a vital link that will have serious consequences.

What is equally concerning is the Covid-19 outbreak in parts of China that has resulted in cities going in for a lockdown.  When a large country which is literally the centre of gravity for critical supplies comes to a standstill, other nations suffer too. 

In India, it looks as if the pandemic has reached its last lap and people will now need to learn to live with it but some studies indicate that a fourth wave may just erupt in the coming months. Hopefully, the vaccinations and the experience in dealing with this invisible assassin will keep the threat at bay.

The Russian aggression will only deepen fissures in an already divided world where every country is taking positions. The US clearly is in no mood for conflicts any longer quite unlike the past when it was all over the planet be it in Vietnam, Iraq or Afghanistan. Sensing this withdrawal, China will be keen on asserting its supremacy across Asia-Pacific where a considerably weakened Russia will also play ball as a weak accomplice. Geographically, India is literally between a rock and a hard place…the challenge lies in walking the tightrope carefully.

The last few days have seen disturbing news of electric scooter fires breaking out in Pune and Vellore with tragic consequences. Quite naturally, this has caused a great deal of consternation especially when a father and his daughter died in the process. It would be premature and reckless to blame manufacturers without proper investigations into the accidents but in a social media-dominated world, bad news can spread like wildfire (no pun intended). 

Electric scooter makers are part of an ecosystem which is cool and fashionable but incidents like these should compel them to revisit safety protocols on battery management. It is also perfectly legitimate for policymakers in India to push for electric mobility aggressively, especially when oil imports are hurting the economy, but not at the cost of people’s lives.

As the auto industry enters the new fiscal, manufacturers will be hoping for better times ahead even though it is clear that the war in Ukraine will have its fallout. Customer sentiment could be severely impacted by food inflation and this explains why automakers would rather take one thing at a time. Many homes across the country are still feeling the impact of the pandemic in terms of lives and livelihoods lost…to expect them to buy a two-wheeler at this stage would be cruel and unrealistic.