Western countries have made it clear that the sanctions on Russia are aimed at punishing Russian President Vladimir Putin, who has thrown the world into trouble by attacking Ukraine. The sanctions announced so far have targeted Russia’s banking and financial system. The aim is to aggravate the crisis of the Russian economy so that dissatisfied with it; the Russian people throw Putin out of power.
French Finance Minister Brune Le Meyer said in an interview to a French TV channel on Tuesday – ‘We will create a situation that will cause the Russian economy to collapse.’ Although there is a realization in the West that Russia is a major supplier of energy to the world, it is not easy to bring its economy to a complete halt. Russia itself meets 40 percent of its natural gas needs and 25 percent of its crude oil requirements for Europe. One of the consequences of imposing sanctions on Russia has come to the fore in the form of gas and oil inflation in Europe.
Despite this, experts say that the scale of sanctions imposed on Russia by the US, UK, European, Canada, Japan, Australia, and other countries is unprecedented. Even Switzerland has joined the caravan, while it is known to protect the confidentiality of its bank accounts.
Oliver Allen, a market expert in an agency called Capital Economics, told American TV channel CNN- ‘The number of people in their countries has been surprised by the number of sanctions imposed by Western democracies. The effect of these sanctions will be that Russia will be completely cut off from global financial markets. On the other hand, an official of President Joe Biden’s administration in Washington said – ‘Our strategy is to push the Russian economy back as much as Putin advances the attack on Ukraine.’
Experts are now looking to see what happens to the Russian financial system. There are reports of long queues at ATM machines in Russia. Due to this, there is a possibility of a cash crunch in the country. Economist Liam Peach, an expert on emerging economies at Capital Economics, said the impact of these sanctions could force Russian banks to sell their assets. They may have to sell these properties at throwaway prices.
Western experts estimate that compared to the amount deposited in foreign currency with Russian banks, only 15 percent is actually such currency. In such a situation, if many people want to withdraw their money, then these banks will be in trouble. This will also increase the pressure on the Central Bank of Russia. But these experts acknowledge that oil and gas exports are big support for Russia. It is the compulsion of the buyer countries to pay for oil and gas. Therefore, the western objective of stalling the Russian economy may take a long time to be fulfilled.
