 The war in Ukraine has entered its third week. There have been a lot of developments over the past few days, advances on the ground in terms of military action, a lot of discussions as well, sanctions have been imposed, the economic consequences are going to be quite severe. We're going to be talking about all of this in Mapping Fault Lines. As we enter week three of the war, if we look at the situation, what we see of course is that some of the key axes from last time continue to be the same. There's an encirclement around Kiev, there's been movement of forces around Kharkiv. A lot of action has been happening in the Black Sea regions where cities have been slowly being taken. Mariupol of course remains a key element, a key focus area as far as the Russians are concerned. There's been a lot of fighting around that area as well. But there have also been some discussions, on the discussions happening between Russia and Ukraine, including at the foreign minister level, which is the highest that has taken place so far. So probably could you first give your own impressions of what you see as a situation on the ground and are these talks likely to bear fruit? You know, if you look, as you said, the situation of the ground, you can see the steady advance of Russian forces in different parts of the region. It's also very clear that those who expected a very quick military action, a shock and all kind of model didn't take this for granted that after all, as far as Russia is concerned, this is still Russian or Russian-aligned people. They are people who they think are their brothers. In fact, they, as you know, go back to Kiev, the Rus as one of the originations of the Russian people. So given that, they were not going to use large-scale bombing, flattening of the type that, for instance, the US did in Iraq. That was not the model they were going to do. So the shock and all model was not what was going to be used. They have targeted military forces of Ukraine, the air defenses, and they have tried to encircle population centers. In this, Kharkiv and Mariupol have been the key ones which have held out. And they have also taken the Donbas region, which is what the target was, Donetsk and Lugansk, which are the two breakaway provinces. And they seem to have controlled that militarily. So they have very clear targets. Odessa, Kiev is another, but more at the moment to encircle Kiev and not take it over as of now. And they also have done some strikes in the west, the western part of Ukraine, which are fresh. They haven't struck that earlier, particularly as it seems to be that there is some movement of arms and other materials coming in from, for instance, Poland and other places. And the supply centers for what could be there further are basically located in the western. Really the air ports over there, which they seem to have struck. There is, of course, a disquieting feature in all this. The Chernobyl, for instance, the power has been blown up. Each side has blamed the other. We now get to get into it. But the question is, yes, these are sensitive issues because though there is no immediate danger, but those facilities still require power, even if they have been shut down. So those things are reason for worry, as well as there are certain other nuclear plants in Ukraine. I think there are three more nuclear plants in Ukraine. So the one that has been taken over, Zaporizhia and Chernobyl are two of the larger ones. Chernobyl was inactive for quite some time. There are three more operating plants. All of them, of course, are worried in a war what happens if there is something that goes wrong. As of now, power doesn't seem to be going off in most of the urban areas. Internet seems to be functioning. Therefore, you would say this is unlike other wars that we have seen where the US, for instance, has fought whether it's Libya or whether it is Iraq. So this seems to be, in that sense, a scenario where we should not expect rapid advances. And the pressure on the Ukrainian government is that the settle on the terms that Russia is now dictating to it and how much they will accept will determine how much or how long the war will continue. It does seem that Zelensky's government is willing to accept some of the major conditions. But the neutrality and disarming of Ukraine because Putin said disarm Ukraine. Demilitarize and demilitarize. Demilitarize and demilitarize. Demilitarize is a heart and soul question. That's not going to be done except for dissolving as of Battalion, which is a part of the Ukraine forces now, some of the key elements who have really become integrated with the Ukrainian government structures. So those are easier to do. But the demilitarization of Ukraine and to denazify Ukrainian people's minds towards these forces, that's a different order altogether. So we have to see which way it goes because as of now, three rounds of discussions have taken place in Belarus, it seems to be more looking at the nuts and bolts of what cannot be done in terms of an agreement while any meeting between Zelensky and Putin will depend on the homework done, otherwise Russians are not at the moment interested in the meeting just for the heck of it because that doesn't help them. So they think that any meeting that should take place should be after they already have worked out which is what normally happens when summit meetings take place unless, except for what we have seen recently when the summits didn't produce any results where already homework is done by both sides. So you know what are the parameters within which the discussion is taking place and whether an agreement is possible or not. So it does seem that we are moving closer to an agreement but yes, there are still obviously outstanding issues otherwise it has been announced already and therefore the Russian increase on pressure on the Kiev's government and you can see the encirclement now the movement of that tank convoy which was not moving for about a week or so so all that has now started which is a prelude to really encircling Kiev and that I think is the key take away at that moment military slow advance and attrition by the Russian forces the Ukrainian forces clearly being able to fight in city centres where the Russians are not interested as yet of large scale destruction now Kharkiv and Mariupol seem to be moving in that direction that civilian facilities will also be attacked we have to see how much we can get the Ukrainians to come to what the Russians want where the Russians will agree to it that will determine the fate of this war and I do not think that Russia wants an occupation of Ukraine but if there is no resolution then what happens of course all bets are off in that case absolutely Praveen also in the past few weeks about 10 days maybe we have seen this massive upsurge so to speak in western society this is happening at multiple levels we know for instance that brands across the western world are boycotting or withdrawing from Russia we have seen this boycott of Russian cultural figures even from the past or currently practising artists, athletes all that and there has been a lot of discussion about that but the deeper structural question really is of sanctions because that is what everyone is concerned about this is an impact on oil supplies and gas of course it is an impact on food because Russia and Ukraine export a massive amount of wheat so considering what has been announced till date especially the US ban on the import of Russian oil which is quite big as 8% of US imports basically are from Russia but not only US but also globally how do you see these sanctions sort of playing out and what is likely to be their concrete economic impact you see there are two other wars that are taking place simultaneously along with the physical or the military war that is taking place in Ukraine that is the economic war that you are talking about and the information war the information war lets be very clear the US and its allies have won the information war from day one in fact they had won it even before the war started so that is taken for granted that Putin is a bad man and Biden in spite of the fact he was a part of the Iraq war he was a part of the Afghan war before finally withdrawing from it he has been a part of the US establishment or Euro Maidan the Euro Maidan coup for that matter Euro Maidan coup because that type he was very much involved in it so all that is forgotten so what you see is of course that the US is now on the side of angels and while Putin is of course the really the Mordor in the Sauron of the Lord of the Rings book so this has been the picture that has been painted but this started well before any of this and suddenly they became the defenders of the Prussian people against the oligarchs I wish they would also have the same logic applied to the United States but the oligarchs are actually much bigger than what the Russian oligarchs are however much you detect the Russian oligarch there is no comparison in terms of their wealth and their loot to what for instance Bezos and company I think the joke has been that you are oligarchs so our oligarchs provide employment opportunities so that is one part of it the information war has been one decisively they control the basic channels that all of us use YouTube, social media platforms like Twitter, Facebook so that's a complete victory they also control the various internet layers and they are able to throw out RT from even the internet but right now for instance the television channel is not accessible in India so RT as a news site you can still access but you can't see the videos so this has been already part of the information war and the US knew from day one and I'm sure the social so did Russia that whatever the freedom of press is it won't be extended to Russian channels and Russian media so that is very much there in terms of the economic war this is where we enter completely it's known so to say because this is a level of sanctions we have never seen before there is a seizure of Russia's basically whatever its foreign exchange reserves was with the West and that's roughly about 300 to 400 million dollars now these reserves supposedly are Russia's but at the same time if they are frozen because they are banked the West it is held in their currencies therefore it's held with their central banks therefore it can be technically frozen that's what the language that is being used but for all practical purpose it means being appropriated because Russia cannot use it anymore and the money is still in their banks so this is the great issue that comes so what is the implication of this this is what happened to for instance Afghanistan when they saw 9.5 billion dollars of federal money that Afghanistan had in the Federal Reserve Federal Bank taken over and distributed by the President of the United States as if it was US money so you have this example also earlier with Libya I think there was 100 billion dollars of Libyan reserves in US and UK somewhere including their gold which all again disappeared we don't even know what happened to it you had Venezuela's gold which the United Kingdom seized so you have a whole lot of these examples already but this is nothing compared to the kind of sanctions now that has been imposed on Russia and let's not forget Russia is 11th biggest economy by basically the dollar ruble value of course the ruble value is tagged completely at the moment but in terms of purchasing power parity which is in some sense another measure of the power of the domestic economy Russia is the 6th biggest economy in the world so this is not a small economy and as you point out it supplies raw materials that's why they are being referred to sometimes derogatorily as a petro state that they supply oil, they supply gas and also what are called other condensates which is fuel, oil naphtha etc. which uses feedstock to fertilize us so all of that put together is only one part Russia also as you have said supplies for instance grain it's a larger supplier of wheat apart from Ukraine in the world I think both put together was 25% of the supply of wheat to the global system but apart from that it's also important for agriculture because phosphates basically the fertilizers which are required for agriculture for instance in India they are again the largest supplier is Russia there is also more tricky issues which are coming up when you start unraveling the supply chains of different sectors of the economy there is also the question of chips Russia has been banned from accessing chips manufactured designed by the United States now that is fine but then what is not realized there are certain key elements to the manufacture of chips which again require Russia to manufacture as well so one of the largest suppliers basically of neon is in southern Ukraine and under control of the Russians at the moment you also similarly have what is called the sapphire substrate which is important for manufacturing chips apparently most of it particularly the high quality ones almost entirely come from Russia so the global supply chains are closely intertwined you take the value of the dollar not what it is being quoted in terms of the financial markets but you take what its value should be in terms of the real economy and I am talking about the real economy which is what you and I consume or use physically not the financial instruments which only the banks and financial players use if we take that then today unlike what happened in the 50s or 60s when the US was the major trading partner almost all parts of the globe today its China which is the major trading partner all across the globe so the physical economy does not need the dollar as a means of trade which is what it did in the 50s and 60s when dollar was the king today it is the king because the financial systems are controlled by the United States and the swift banking system and all of these things but lets be very clear as long as the physical world gets disconnected in this way from the financial world will the value of dollar start changing and will other countries that includes India, China start looking at Russian trade not in dollars but in their currencies now if that happens what happens to dollar as a global currency and of course it will still be a very important one so will the euro but will we see the reflection of the real economy which is the physical trade that we are seeing also impact the global financial flows and will we start seeing that other currencies will slowly replace the dollar and the euro as more of storing money storing value as well as also trade now one important part of it that when you think of a foreign exchange surplus you think that's what you will use in future if you are trade and you are not able to supply as much as you want to buy so it's a something you keep aside for a rainy day now if the rainy day the supply is not available then will you hold it is there a point of holding a surplus is there any value to a balance of payment surplus itself or should we all start looking at a low balance external trade economy that means we neither have a surplus nor have a deficit because building a future per kitty for your rainy day doesn't seem to work because what you are giving is that you are giving a hostage to the to United States and the European Union as I have written somewhere that it's like the elder times when you have to give your children as hostages to the emperor and they would come up those who are the thieves had to do that their children would be brought up by the emperor so this money that you give as a hostage to the United States then or to European Union as what you think are your foreign exchange reserves really are not your reserves they are essentially hostages that now European Union and United States have shown they can hold against you in case you disagree with what they are doing now of course Ukraine war doesn't mean that every country will go to war but this of course doesn't prevent them from going to war as we have seen France in Africa and as we have seen the US and the NATO around the world absolutely thank you so much for being here we will be tracking many of these issues in future episodes of mapping fault lines as well until then keep watching news click