The Russian Ukraine war that has resulted in tremendous casualties and destruction in Ukraine with about 8 lakh refugees leaving the war torn nation entering Poland, Hungary, Slovakia and Romania etc seeking refuge with Indian nationals too in quite a disarray, India is bound to confront an adverse situation in terms of its imports from Russia, its traditional friend pushing India’s import bill higher leading to high costs of the imported items viz grains, mineral n crude oils, edible oils, jewellery items and fertilizers etc.
After imposition of wide scale economic sanctions against Russia by European Union countries and the Western nations like super power US etc n Russia Ukraine conflict, India which depends on Russia significantly in terms of major imports as above according to the Indian Ratings and Research ( Ind- RA) the merchandise Imports may exceed 600 billion dollars in the Financial Year 2022.
According to various reports, the ongoing war between Russia and Ukraine and subsequent cumulative sanctions against Russia, not only will the value of Indian rupee come down and inflation affecting India its current account deficit will also surge.
According to the Business Standard report as per the Indian Research and Rating Analysis a 5 Dollar per barrel increase in crude oil prices will translate into a 6.6 billion dollars increase in trade or current account deficit leading to the ramifications of Russian Ukraine conflict on Indian economy which will be experienced via higher global commodity prices as India is a net commodity importer from Russia says the news report.
The BS report quoting IANS further states that besides high crude oil price is a cause of concern for India as it may add Rs. 8 to Rs 10 in petrol, diesal prices if the OMCs decide to revise the current prices.
This unambiguously states that the rising crude oil price including surge in important prices will have a cascading effect on inflation being already confronted in India. It may be recalled that at present India imports 85% of the crude oil needs with the country raising the petrol, diesal and domestic gas prices number of times leading to all round inflation.
