The Ripple Effects of the Russia-Ukraine War on South Asian Economies: Trade, Energy, and Inflation in a Geopolitical Crisis

Abstract

The Russia-Ukraine war has unleashed a series of global economic disruptions and had profound consequences for the economies of the countries of South Asia. This qualitative analysis looks at the impact of the conflict on critical economic issues like trade, energy provision, inflation, and foreign investment on countries such as India, Pakistan, Bangladesh, Sri Lanka, and Nepal. According to news report and expert interview analysis to understand the multi-dimensional implications of the war on these economies, data were compiled based on the content analysis of secondary sources such as government reports, economic surveys, news reports and expert interviews. The report reveals that SAARC countries had to deal with an increasingly expensive energy, disrupted supply chains, inflation and changes in trade patterns resulting from sanctions and geopolitical realignments. Moreover, the war also compounded pre-existing vulnerabilities, including food security and exchange rate volatility, particularly in import-reliant countries. But other nations used the uprooting as an opportunity to diversify their energy supply and bolster trade relationships in the region. While the war generated acute economic challenges in the short-term, it also opened the space for strategic economic reforms and resilience. In its totality, the research highlights the convergence of global conflict and regional economic heat - and the importance of attuned policy in South Asia to absorbing global shocks.