Deterring President Vladimir Putin Through Sanctions Jesbil Singh Sandhu

Russia's build up of some 200,000 troops, amassed on the borders of Ukraine, established through satellite imagery and military intelligence, its military exercises in Belarus, and the recent decisions of President Vladimir Putin over Ukraine, has brought about the worst security threat to Europe since Second World War, as well as challenged the post war order and balance of power. The question that the international community is asking is whether Russia is actually planning a full scale invasion of Ukraine, eight years after Russia occupied and annexed Crimea in 2014. Some have likened this to the Cuban Military Crisis of 1962, when confrontation between the United States of America and the Soviet Union, brought the world to the brink of war.

While the expected full scale invasion of Ukraine has yet to become a reality, President Vladimir Putin on 21st February, 2022 issued a Presidential Decree recognising the independence of Ukraine's eastern provinces of Luhansk and Donetsk, parts of which have been controlled by rebel forces since 2014. Added to this is the decision to deploy Russian troops for peace keeping operations in these break away provinces. His hour long speech touched on the past glory of the Soviet Union, denying the existence of Ukraine as an independent nation and arguing that Ukraine is historically, culturally and spiritually an integral part of Russia.

All these moves by President Vladimir Putin, both political and military in nature, happened inspite of the flurry of diplomatic activities and efforts by world leaders including President Joe Biden of the United States of America, Prime Minister Boris Johnson of the United Kingdom, President Emmanuel Macron of France and German Chancellor Olaf Scholz, and by their foreign ministers, to find a diplomatic solution to the crisis.

President Vladimir's Putin's actions have brought about swift and sharp condemnation from the international community, expressed in the strongest and harshest of terms by the United States of America, countries of the European Union, North Atlantic Treaty Organisation (NATO), as well as the UN Security Council as being a violation of Ukraine's sovereignty and territorial integrity.

More importantly, these have also brought a quick reaction going beyond condemnation, those in the form of sanctions to be imposed on Russia by the United States of America, United Kingdom, Germany, Canada and Japan, amongst others. These target Russian individuals (oligarchs) and entities, including banks, access to the international financial system, restrictions to trade and denying entry into markets.

One of the most significant sanctions is by Germany, which has halted the certification of Nord Stream 2, a gas pipeline built to supply gas from Russia to Germany, bypassing Ukraine, potentially causing a huge loss of revenue to Russia.

It has been stated that these sanctions announced thus far are merely the first tranche, and are perhaps more symbolic in nature. More serious sanction packages have also been drawn up, only to be announced and executed if President Vladimir Putin makes any further military moves over Ukraine, and those that will really bite into the Russian economy.

If this is so, the issue is whether the sanctions announced thus far, with a view of more to come, will really deter President Vladimir Putin from further military moves, including a full scale invasion of Ukraine. Some argue, though, that the invasion of Ukraine has already begun.

For that matter, hawks in the United States are arguing that sanctions are not good enough to deter President Vladimir Putin. Instead, they are advocating a military response from the United States and NATO. They go on to argue that President Vladimir Putin has sensed their weak resolve, thus emboldening him.

While the announcements of the sanctions are beginning to hurt in terms of a further fall in prices of Russian stocks, bonds and the Russian Ruble, which were already declining since the start of the Ukrainian crisis.

Some argue what could really hurt Russia would be the loss of energy revenue as Western Europe is its major customer and heavily dependent on Russia for its energy needs of approximately 50 per cent. Admittedly, Russia could divert these energy supplies to a friendly country like China, which relies heavily on energy imports to meet domestic needs and fuel its economy.

It must also be mentioned that the Ukrainian crisis has also put a great deal of pressure on oil prices, already brought about by other geopolitical developments such as those involving Libya, the inability of OPEC nations to significantly increase output and investments by oil companies that have moved away from fossil fuels into renewable energy. A global post Covid economic recovery is also creating a much higher demand to meet energy needs. The price of Brent Crude oil momentarily came close to USD 100 because of these recent developments over Ukraine. The price has now retreated somewhat.

Could President Vladimir Putin use the increased energy prices and potential disruptions of oil supplies as a political tool to his advantage, as any drastic action by Western Europe could also hurt their economic interests?

What President Vladimir Putin will do next is anybody's guess. Will the sanctions put an end to his further actions, including a full scale invasion of Ukraine, if that is what he is really planning? Will he take his eyes off the Baltic States of Lithuania, Estonia and Latvia, who seemed rattled as a result of the recent developments and wonder whether they are a part of President Vladimir Putin's grand design of Russian expansion.

One must also ponder whether President Vladimir Putin had already factored in the unified Western response and possible sanctions into his strategic calculus regarding his intended moves over Ukraine. It is said Russia has been building up huge foreign reserves of major currencies for some time now.

The other question that arises is whether President Vladimir Putin will use the presence of Russian troops in the independent provinces of Luhansk and Donetsk, now present in a more open and transparent manner (ostensibly as peace keepers), and the right to build military bases, push for the takeover of more territories which are still not under rebel control. If this is part of his agenda, a successful takeover of all of these territories would effectively result in weakening and dividing Ukraine.

With Ukraine being successfully pressured not to join NATO, so as to protect Russian security interests, being one of President Vladimir's agenda, it would mean that he would have successfully achieved his goals. Could this be really President Vladimir Putin's end game? Will this be his second major victory over Ukraine, the first being the occupation and annexation of Crimea.

Has diplomacy still a place in the Ukrainian crisis? Will President Vladimir Putin agree to the resolution of this crisis through diplomacy, the United Nation's Charter and further discussion and implementation of the Minsk agreements. Statements just made by him suggests that he is now in a more conciliatory mood and that he has not completely shut the door to diplomacy.

In the final analysis, are sanctions, those already announced, and more to come in the event of further Russian military moves, really putting the brakes on President Vladimir Putin?

The world is watching and waiting.

Jesbil Singh Sandhu, Doctor of Business Administration (DBA) is a Professor at the Faculty of Defence Studies and Management and a Research Fellow at the Centre for Defence and International Security Studies (CDISS), National Defence University of Malaysia.

This commentary was written just hours before President Vladimir Putin announced his 'Special military operations in the Donbas region'. Since then new tranches of sanctions have been announced.