Will There be a Cease-fire in Ukraine?

The war started by President Vladimir Putin’s facetiously and fallaciously termed “special military operation” on 24^th February 2022 shows no sign of ending soon unless President Volodymyr Zelenskyy signs on the dotted line. So far there is no reason to believe that despite the heavy odds he is facing, Zelenskyy has any intention for now to do that.

It is obvious that unless the three presidents (Putin, Zelenskyy, and Biden) who have unwittingly worked together to start and continue this horrendous war, find that it is in their interest now to end the war, it will not be ended.

Coming to recent developments, we need to look at the economic sanctions on Russia; the military assistance given to Ukraine by NATO; the threats issued by Putin; and the response of the major countries in the UN forum and elsewhere.

Sanctions and Their Impact

President Biden has taken the lead with European Union, Australia, Japan, South Korea, Singapore, Taiwan (Republic of China) and others following him more or less promptly.

While Biden has banned energy imports from Russia, he has chosen not to apply secondary sanctions in the matter. We note that while President Trump imposed sanctions on Iran’s export of oil, it was meant to stop Iran’s export of oil to US and to the rest of the world. Any company outside the US importing oil from Iran would be blacklisted and denied entry to the US market. Any country that permitted such import would earn Washington’s displeasure. Only China ignored the threat and that too successfully. India and South Korea complied with Trump’s sanctions with a degree of alacrity.

America has been importing daily 700,000 barrels of crude and refined products from Russia which exports 5 million barrels of crude and 3 million barrels of refined products daily. Though only 0.09 % of Russia’s export is affected, the oil market is vulnerable to speculation and oil prices jumped up to $130 a barrel. But it has come down to $112 a barrel. More ‘paper barrels’ are sold daily than real barrels.

Washington has banned American companies from carrying on business in Russia. A number of them including Boeing, MacDonald, and oil companies have complied at heavy cost to themselves.  Take the case of aircraft leasing. 523 aircraft are on lease in Russia out of which 101 have been leased by Aeroflot and S7 airline.  Recently, much before the war, an American specializing in aircraft-repossession business, succeeded in locating a leased aircraft on an airport in Russia. The lessee was not paying the dues. On examination he found that there was no engine. Obviously, the leasers are going to incur heavy losses to the tune of $12 billion, according to an estimate.

This raises another question. What is the total in Russia of the companies and banks from the West? No consolidated figure is available. Banks alone have lent or invested a total of $120 billion.

Putin has ordered the seizure of properties and assets of all Western entities that have got out of Russia.

We note two lessons from all this. First, economic sanctions are a two-way street: both the sanctioner and the sanctioned suffer. For instance, the price of nickel has shot up adding $1,000 to the cost of producing an electric vehicle in U.S.

Second, Russia’s dependence on China will increase over time and globalization is being reversed. China has its version of SWIFT and Russia might start using it.

Obviously, such economic de-globalization will have its geopolitical consequences. Are we looking at a time, say 2030, when America sees a world where its sanctions and dollar might lose a good deal of their current clout?

Russia has offered oil at discounted prices to India. Should India take it?  There are pros and cons. A case can be built up for accepting the offer. India in the long run would like to see a world without sanctions. In the present case, a cost–benefit analysis is called for before taking a decision. We may note that Russian TV (RT) is no longer available in India.

Russia supplies 45% of EU’s imports, and 40% of total consumption. There is no way EU can stop importing gas from Russia right now. EU has made plans to free itself from such dependence by 2027. We do not know whether the target would be met.

NATO’s Military Assistance to Ukraine

Announcements of assistance from NATO, military and non-military, are pouring in at a rate higher than actual delivery. The repeated plea by Zelenskyy for a no-fly zone have been correctly rejected by NATO. Nor has he got the Soviet-era aircraft.

Threats Issued by Putin

By publicly announcing that he had ordered that the nuclear forces be put on a “special combat readiness”, an announcement first made on 28^th February 2022, Putin wanted to make assurance doubly sure that NATO would not directly intervene militarily in Ukraine. Whether the ‘readiness’ has been actually raised or not, NATO has wisely and responsibly refrained from ‘raising’ in retaliation.

Response from the Rest of the World

Biden’s policy of imposing economic sanctions on Russia has been accepted and acted upon by about 20 other countries.

Protests against Russia continue in many world capitals and in Russia where thousands have been detained.  At the UN General Assembly, a resolution criticizing Russia got 100 votes in favor, 11 against, 58 abstentions, and 24 refusing to vote. The GA has 193 member-states. Considering that Russia committed aggression, it is noteworthy that 93 member-states did not want to lend support to America.

Is America’s Political Clout Under Biden Decreasing?

Yes. Saudi Arabia and UAE are upset with Biden.  As a candidate Biden had referred to Saudi Arabia as a ‘pariah’ state, following the horrendous murder of Washington Post journalist Jamal Khashoggi, 60, in the Saudi consulate general in Istanbul on 2^nd October 2018. Biden declassified the findings of the intelligence agencies and had a conversation only once with King Salman, 86. The White House made it clear that the President will not deal with the Crown Prince Mohammed bin Salman, 37, who is in charge. Biden also reduced the arms supply to Saudi Arabia engaged in an unwinnable war with the Houthis in Yemen.

The UAE abstained on US resolution against Russia in the Security Council.

The latest is that after banning oil import from Russia, Biden wanted to prevent the price at the pump from going up. For that reason, Biden tried to call the Crown Princes of Saudi Arabia and Abu Dhabi. Both refused to talk to him.

Here a comment is called for. Was it necessary for the President to talk? Was it necessary to let the media know that he had been snubbed?

In this context it is necessary to say a word about the diplomatic style of Secretary of State Antony Blinken. After Washington rejected Zelenskyy’s   public request for NATO to establish a no-fly zone in Ukraine, he asked for Soviet-era aircraft that Poland has. Blinken publicly discussed the matter suggesting that if Poland transfers the MIG-29 aircraft to Ukraine, Washington would replenish Poland’s fleet. Poland did not want to earn Russia’s wrath by sending aircraft to Ukraine and publicly announced that it would send the aircraft to American bases in Germany from where they could be sent to Ukraine. Was it necessary to display the disarray in NATO?

In conclusion, we might make a few comments.

First, the belief that sanctions alone would make Putin change policy is rather naïve.

Second, the NATO wisely does not want to take on Russia militarily. However, much Ukraine is armed, the Russian military cannot be stopped. More resistance by Ukraine means more destruction, more casualties, more refugees, and more suffering for Ukrainians caught up in cities such as Mariupol.

Third, though he publicly stated that Zelenskyy was abandoning his bid to join NATO, Putin is likely to insist on a more solid guarantee.

Fourth, Putin has certain minimum territorial acquisitions in mind, and he might not agree to a cease-fire till they have been met. He probably wants Odessa giving Russia complete control over the Black Sea. The protests in Russia are growing, but unlikely to make Putin change policy.

Fifth, the world economy will suffer from the war and the sanctions.

Sixth, though Putin has ordered putting nuclear forces on a higher alert, the Bulletin of Atomic Physicists has maintained that no practical action has been taken. However, if there is an ‘existential’ threat to Russia or his own political survival, we do not know whether he might use a tactical nuclear weapon pushing the NATO into a terrible dilemma.

We need more of classical diplomacy and less of public diplomacy. We can only hope and pray for an early cease-fire to be followed by negotiations, as urged by India, again and again.

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