Russia is headed for a major economic crisis

The Western countries have started to block select large Russian banks on the SWIFT banking system. Society for Worldwide Interbank Financial Telecommunication (SWIFT) is a secure messaging system that facilitates payments between thousands of different countries in the world, thereby facilitating international trade and financial transactions. The banks of the countries connected to the SWIFT system ensure payment by quick exchange of messages among themselves. Swift was founded in 1970 with the aim of making global trade easier. It is a cooperative system of 11,000 financial institutions from 200 countries, which operate mainly under European and Belgian rules. Through this, more than five billion financial messages are sent every year. Economic sanctions are being imposed on Russia’s big banks in an effort to isolate them from international financial organizations and European countries, causing Russia’s financial markets to falter. There the demand for cash has increased 58 times. However, the Russian government is trying to hide such ill-effects and the reality of the war from its citizens.
Not that the ban on the SWIFT system will leave Russian banks with no choice. They will be able to exchange financial messages with friendly countries through email, phone, messaging apps etc., but these measures are not proven to be very secure, so trade volume will definitely be affected. Russia can meanwhile use the China Interbank Payment System or the Cross-Border Interbank Payment System (CIPS), a payment system which offers clearing and settlement services for its participants in cross-border RMB payments and trade. It is a significant financial market infrastructure in China. Even India is likely to develop a new transaction system to deal with Russian banks to keep its business interests smooth. India is a major importer of Russian defense equipment, fertilizers, oil and natural gas. Buying fertilizers from Russia is a major compulsion for India to fulfill the needs of its vast agricultural sector. Russia’s biggest source of income is the sale of oil and natural gas. The conflict with Ukraine is sure to have a huge impact on the sales of both the products. Many countries would not want to buy oil and gas from Russia. Due to global warming, the world is slowly turning to alternative sources of energy by abandoning fossil fuels anyway.
Russian airlines are forced to cancel flights to Europe after 27 EU countries barred Russian airlines from flying over their airspace. Russian airplanes will neither land nor take off in these countries nor will they be able to pass through their skies. The UK and Canada are also among the countries closing their airspace. In return, Russia has banned commercial flights from Britain, Poland, Bulgaria and the Czech Republic. Retail prices of everyday consumer items are rising in Russia. The impact of this war in Russia will be felt for a long time. Income will decrease and the difficulties of the middle class will increase. Russia will also have to face a problem that all the exporters of the world will now shy away from sending goods to Russia considering trade with Russia as expensive, unsafe and risky. Whereas buying readymade goods is a compulsion of Russia. Its largest trading partners are China, the Netherlands and Germany.