Global economy bearing the brunt of war, supply chains affected: FM

Finance Minister Nirmala Sitharaman on Friday said the global economy is bearing the brunt of the sporadic eruption of wars as well as the realignment of the post cold war blocs, which have led to disruption of supply chains.  Sitharaman also said global institutions like the World Health Organisation, United Nations and WTO, among others, have become less effective now and need reforms.  

Addressing the inaugural session at the Kautilya Economic Conclave in New Delhi, Sitharaman said, “Today we have persisting two wars and one war that has broken out recently. Three wars are happening simultaneously and at places where the supply chains are getting severely impacted. Source of food grain is being impacted. Transhipment of goods is being impacted. So we have the wars also today to bear the brunt of.”

Sitharaman also said the strategic blocks from the cold war days are now reshaping themselves, which is also costing the global economy dear. “They are no longer in the same frame in which they were earlier. New elements are getting into the blocs. Some elements are from totally ungrouped formations earlier. Or people are falling out of a group and this is impacting the economy. The supply chains are getting influenced because of that,” said Sitharaman.  

Sitharaman pointed out that in the current context, global institutions like the World Health Organisation, United Nations and WTO, among others have become less effective than they were once and need reforms. 

“Globally we do not need to hesitate any longer to say that the multilateral institutions, not just the development banks whether it is United Nations, the Security Council or others like WHO and WTO are less effective from where they were made into institutions. We have reached a stage where what we would take for granted is no longer to be taken for granted,” She added.