October 29, 2021
US Senators urge President Biden not to sanction India on Russian weapons purchase, implications for global Russian defense deals and China. In 2018, India committed to buy five units of the Russian S-400 surface-to-air defense missile systems and the first batch is scheduled to arrive this year. Delhi aims to ramp-up defenses against Pakistan and China, particularly given the ascent of the Taliban and ongoing border disputes, but the S-400 purchase subjects India to sanctions under the US Countering America’s Adversaries Through Sanctions Act (CAATSA) which prohibits engagement with Russian defense or intelligence sectors. In 2020, Washington sanctioned Turkey under CAATSA for purchasing the S-400 system, but some US senators are arguing there is now a “national security imperative” for waiving sanctions on India. Security challenges from Pakistan and China are simmering on India’s borders, and this week Beijing issued the Land Border Law, which takes effect Jan 1, detailing how China guards its land borders and emphasizing that the nation is willing to fight for territorial integrity it deems “sacred and inviolable.” India has one of the few remaining unsettled boundaries with China, and the law sends a strong signal that Beijing isn’t going to hesitate to use force.
As COP26 approaches, green and sustainable bonds continue to gain traction. The 26th United Nations Conference of the Parties Climate Change Conference (COP26) begins in Glasgow this weekend, with companies, nations, and investors all making pledges and commitments to curb global warming. As part of this initiative, Qatar Energy, a top global liquefied natural gas (LNG) supplier, is reportedly on track to become the first national oil company in the Gulf to sell green bonds as part of its sustainability initiative. According to a recent report by Moody’s ESG Solutions, green, social, sustainability, and sustainability-linked bond issuance will reach a global combined $1 trillion in 2021, nearly doubling from 2020. Green bonds, which have been around for over a decade, are typically used to finance projects pertaining to environmental issues like renewable energy, while social bonds tackle issues like education and healthcare. Sustainability bonds speak to both causes and became especially relevant during Covid-19 which brought social financing to the forefront at the same time climate pressures have increased.
Upcoming local elections in South Africa could challenge leading party. After a summer marked by political infighting, social unrest, looting, and a lapse in the provision of basic services, on Monday South Africa will hold local elections. Voters will be looking for candidates to get the economy back on track and resolve the negative impacts of Covid-19, especially given the continued rolling blackouts and high national unemployment rate over 30%. However, analysts have cautioned that voters are being fed misinformation by campaigners and could be voting to sway national issues that wouldn’t be changed in a local election. Religion has also been newly used as a campaigning tool, with some parties advocating for a return of religious education. Media reports indicate that many younger voters are apathetic and disillusioned with both the ruling African National Congress (ANC) and the broader political apparatus. Nonetheless, local elections tend to be a good gauge for general elections in South Africa, and it will be telling to see how the ANC, who’s won every general election since 1994, will fare given the exceedingly complicated economic and political environment.
