President Trump attacked Iran’s sovereignty with a fatal drone strike on Gen. Qassem Soleimani, the head of Iran’s elite Quds Force and also the top-most Iranian commander. The US military conducted the strike at the Baghdad International Airport solely on President Trump’s decision and discretion and along with the general Abu Mahdi al-Muhandis, deputy commander of Iran-backed militias in Iraq, was also killed.
Quoting an official who spoke on condition of anonymity to “Herald & Review” Abu al-Muhandis had arrived at the airport in a convoy to receive Soleimani whose plane had arrived from either Lebanon or Syria. The airstrike occurred as soon as he descended from the plane to be greeted by al-Muhandis and his companions, killing them all. The US claimed the attack on speculation of Soleimani’s apparent hand in the attack on the US embassy in Baghdad. Trump solely blamed Iran for the attack on its embassy by militia groups.
The attack has opened the battlefield for a deeply hurt Iran and the mighty US. We might be on the cusp of a new age war or a bitter diplomatic snarl but heavy retaliation is going to be seen from Iran’s side. Moving on what does the attack signal for the world of finance and business? For the bankers, businessmen and industrialists the attack means more expensive oil, tensions in the Middle East (with the US losing considerable power there) and also the possibility of a new war considering Iran has just threatened nuclear retaliation.
India which is largely importing oil has a lot to worry about with oil prices on the rise. India cannot afford higher oil prices considering its huge fiscal deficit of 3.3%. India has a lot to lose with the tensions in the middle east because its economy primarily functions on oil and with higher prices, it faces the threat of slowed consumption on the retail front and a lesser production cap. Already facing a slowing economy the country cannot afford a new hurdle in its path towards a slow recovery. The country needs a lower or more stable oil price to heighten consumer demand and to increase the production cap of its oil-reliant industries.
India is once again caught in the crossfires but the outcomes will only be known once Iran speaks out of silence. The blowback effect will only be made clear by Iran and with the region, under heated pressure from the west, the consequences won’t be cozy. The world needs to brace for an impact never seen before and especially economies reliant on the middle east for import. Will the US face the wrath for its decisive action is something to see for.