Economic Sanctions as we understand them today emerged after the First World War in the form of Article 16 in the Covenant of League of Nations. Its expressed purpose was to prevent another great war without resorting to military actions. In the proceeding years, especially after the start of the Cold War, these sanctions were increasingly used by the US-led Western powers to exert pressure on the states which went against their perceived interest and liberal international order. In recent times, however, the effectiveness of sanctions has been undermined by significant shifts in the global power structure.

The most notable change has been the rise of Asia, led by China and India, as a serious economic force.

With China and India’s rapid economic growth and influence, many countries now have alternative trading partners and sources of investment. This diversification of economic ties and rising multipolarity has reduced the leverage that Western nations once held over other states, making sanctions less potent. This seems to be the case as we deeply analyze these trends concerning the Russian-Ukraine war.

Historically, Asia has always been the preeminent economic powerhouse in the world and it has started to reclaim its original place as the economic center of gravity, and with it, a greater part of the global geopolitical equation. For instance, Asia’s economies made for 39 percent of the world’s nominal GDP in 2021, making them the biggest continental bloc. The five biggest Asian economies—China, Japan, South Korea, Singapore, and India—combined account for a quarter of all global imports, while Asian exports make up 36 percent of all exports worldwide. Currently, Asia accounts for 75 percent of global GDP growth annually, with China and India making up the entire half.

This rising economic power has made China transition from a tacit and technocratic foreign policy under Deng and Hu Jintao to a more assertive one under Xi where it does not shy away from confrontation when it comes to their interest as witnessed in the South China Sea. Similarly, India despite enjoying burgeoning ties with the US because of the confluence of their interests vis-à-vis China, still maintains a fiercely independent foreign policy as evident in India being the biggest oil importer as well as biggest arms importer of Russia.

Since the start of the Russian-Ukraine war, about 1275 sanctions have been imposed on the former by US-led Western powers. On top of it; Russia has also been excluded from SWIFT. However, these unprecedented sanctions have not had the desired results. The Russian economy is still afloat and has only lost 2-3 percent of its GDP despite crippling sanctions.

The blow of the sanctions has been conspicuously softened by rerouting its trade from Europe to Asia.

Furthermore, Asian states have served as fresh import and export markets for Russia whose economy hitherto had been highly dependent on the European market for both import and export. The Russian economy has immensely benefitted from this emerging trade pattern. For example, Russia and China’s bilateral trade increased by 39 percent in the first quarter of 2023 and it may amount to US$237 billion by the end of 2023, which would be more than China’s whole bilateral trade with nations like Australia, Germany, or Vietnam. Similarly, trade between Russia and India increased by 205 percent to US$40 billion. This increasing trade with Asian states as illustrated above has more than compensated for the economic loss Russia faced due to Western sanctions.

Similarly, the gain in demand from Asia has more than offset the decline in oil shipments to Europe, which hitherto had been the main export market for Russian oil and gas before the war. Since the start of 2023, India has grown to be the single biggest buyer of Russian oil, acquiring more than 1.4 million barrels daily. Likewise, Chinese importers purchased 800,000–1.2 million barrels per day in 2022. Asian states, specifically China and India, have completely supplanted the European market for Russian oil exports in a single year minimizing the impact of sanctions on her.

The growing Asian economic heft and the growing multipolarity go a long way in explaining why the US-led Western sanctions have lost their impetus in today’s world.

But it’s important to remember that the historical track record of sanctions is mixed, at best, even at the height of US hegemony. In addition to this, the rise of emerging powers and alternative trading partners has enabled countries to weather the storm of Western sanctions more effectively. While sanctions may still have a role to play, their limitations must be acknowledged.

Effective diplomacy, collaboration, and dialogue should be at the forefront of efforts to address international conflicts. West must seek new solutions that can better address the complexities of the modern world. To conclude, the shifting geo-politics and geo-economics landscape seems to be the last death knell for sanctions as a policy tool for the foreign policy of Western powers.