We Must Also Count The Economic Cost Of War

AS calls to punish Pakistan for supporting terror attacks in Kashmir and elsewhere reverberate through the country, and war clouds become darker. RPG Enterprises chairman Harsh Goenka sounded a contrarian warning on Wednesday to beware of "economic tremors".

- GURBIR SINGH

In a Let's-be-careful post on 'X' Goenka cautioned an escalating war could mean a volatile rupee, less FII investment, spiking oil prices, lower infrastructure spending and a falling stock market. Predictably, there was blowback. Many X users said they were willing to see the economy going down but not let India's national pride be overtaken by terror attacks.

These netizens had made a point. There is always a human and economic cost to defending our borders. National security cannot be reduced to budgetary haggling. What has to be done, has to be done. Having said that, what RPG's Harsh Goenka is urging is to keep the broader picture in mind and not let passions runaway and overtake the nation's goals of planned growth and poverty alleviation.

A deadly decade Russia marched into Ukraine in February 2022, expecting to be in Kyiv within 15 days. It is now more than 3 years the grinding war has carried on with no end in sight. Writing a paper for the International Monetary Fund (IMF) on the economic shock of war, well-known Harvard University economist Kenneth Rogoff said: "Russia's invasion of Ukraine is an unmitigated catastrophe for global peace... But the war also greatly compounds a number of pre-existing adverse global economic trends, including rising inflation, extreme poverty, increasing food insecurity, deglobalization, and worsening environmental degradation."