INSTC proves to be ‘silver lining’ amid global food crisis



Since the start of the Ukrainian conflict, food prices have risen globally, with Russia and Ukraine both being key grain exporters. However, the expansion of the International North-South Transport Corridor (INSTC) has proven to be a positive point and its existence is now being prioritized. Ukraine and Russia are both major grain exporters, with 50 countries depending on it for almost a third of their imports, according to Geopolitik.

However, due to the escalation of tensions between the two countries, the export of grain through a safe corridor has been in the news and Russia is experiencing considerable difficulties in exporting its record wheat harvest. According to the chief economist of the United Nations Food and Agriculture Organization (FAO), Maximo Torero Cullen, shortages in the supply of wheat and fertilizers have inflated prices, putting an estimated 1.7 billion people in 62 countries at risk of famine.

In a separate statement, IKAR Director General Dmitry Rylko, a Moscow-based agricultural institute, said sanctions have played a crucial role in obstructing trade globally. Russia is acutely aware of the challenges created by these unique market conditions and is actively seeking to secure alternative markets for its exports to mitigate geopolitical risk and the threat of sanctions, Geopolitik reported.

In addition, Russia’s trade relations with India have developed significantly since the start of sanctions with Russian oil and fertilizer exports throughout the country. The major factors responsible for expanding trade development are the emergence and continued expansion of the International North-South Transport Corridor (INSTC), which is a 7,200 km multi-modal trade route.

INSTC reduces transit times between Russia and India by 40% and logistics costs by 30%. The first pilot transit of goods from India to Russia via INSTC took place in June 2022, but the route will be further expanded by 2030. Tensions between Russia and the European Union have continued to increase over the last six months and it is now difficult to imagine the re-establishment of normal relations between the two organisations.

Despite several shortcomings, the INSTC was now treated as a priority not only by India, Russia and Iran, but also by other Central Asian countries such as Georgia, Azerbaijan and Kazakhstan, according to Geopolitik. Russia is looking for more options to offset the sanctions imposed on the country by Western nations and the country is considering a realignment of its trade relations, which is why Moscow aims to expand its trade in the Central Asian region through the North South. Corridor.

The INSTC Corridor connects Asia to Europe and helps Asian nations by providing connectivity. A series of heavy sanctions against Russia did not move the country from its stronghold position as an energy producer and now Russia is focusing on the INSTC. (ANI)

(This story has not been edited by the Devdiscourse team and is auto-generated from a syndicated feed.)

Source link


Comments are closed.