By PTI
LONDON: Russian companies in the aviation or space industry will be prevented from making use of UK-based insurance or reinsurance services directly or indirectly, the UK government announced on Thursday as further sanctions in response to the attacks on Ukraine.
UK Chancellor Rishi Sunak said the latest measures will limit the benefits Russian entities receive from their access to the global insurance and reinsurance market.
“Russian companies in the aviation or space industry will now be prevented from making use of UK-based insurance or reinsurance services directly or indirectly. This measure will severely limit their access to the global insurance and reinsurance market,” he said.
Through Lloyd’s and the London market, the UK describes itself as a world leader in these sectors of the global insurance market.
In taking such action, the UK is demonstrating its commitment to apply severe economic sanctions in response to Russia’s invasion of Ukraine, the UK Treasury department said.
The UK government said it will bring in legislation to prohibit UK based insurance and reinsurance providers from undertaking financial transactions connected with a Russian entity or for use in Russia.
“Coupled with similar actions by the EU, this move further isolates Russia’s economy from the international financial system,” the Treasury statement notes.
The move came as the London Stock Exchange Group (LSEG) suspended 28 companies linked to Russia from trading as a result of a series of sanctions being imposed by the UK over the past few days.
“London Stock Exchange Group has suspended trading in 28 Russian-listed securities,” said LSEG Chief Executive David Schwimmer.
“This has been based on sanctions and the ability to run an orderly market. Suspensions are driven by those decisions, so if we see any other securities affected by sanctions then similar actions will take place,” he said.
Companies affected include the state-owned oil titan Gazprom and the country’s largest lender, Sberbank, according to a notice posted by LSEG.
Some of Russia’s largest miners, oil companies, and metals giants have also been suspended, including Lukoil, Norilsk Nickel, Polyus, and Rosneft.
China-based Asian Infrastructure Investment Bank (AIIB) on Thursday put on hold all its projects in Russia and its ally Belarus, a significant move amid the heightening crisis in Ukraine.
The bank’s decision was regarded as noteworthy considering that Russia is its third-largest shareholder.
India is the second-largest shareholder after China.
Former RBI Governor Urjit Patel is the Vice President for Investment Operations of Beijing headquartered AIIB.
The bank is headed by former Chinese Vice Minister for Finance, Jin Liqun.
Besides being the second-largest shareholder India is also AIIB’s biggest beneficiary by obtaining USD 6.7 billion funding for 28 projects.
“Our Bank is actively monitoring the situation and assessing its impact on AIIB’s operations and our members’ economies” as the Ukraine war unfolded, a press release posted on the bank’s website said.
“We, the Management, will do our utmost to safeguard the financial integrity of AIIB, against the backdrop of the evolving economic and financial situation,” it said.
“Under these circumstances, and in the best interests of the Bank, Management has decided that all activities relating to Russia and Belarus are on hold and under review,” the release said.
The bank has financed several projects in Russia and Belarus.
Explaining its decision to put the projects in Russia on hold, the AIIB said it is a “multilateral organisation created by an international treaty, and adherence to international law lies at the very core of our institution”.
“AIIB Management believes that multilateralism provides the best framework for countries to cooperate in dealing with common challenges and supporting development,” it said.
“As the war in Ukraine unfolds, AIIB extends its thoughts and sympathy to everyone affected. Our hearts go out to all who are suffering,” it said.
“AIIB stands ready to extend financing flexibly and quickly and support members who have been adversely impacted by the war, directly or indirectly,” the release said.
“Economic spillover from commodity price shocks, financial market volatility and other factors may adversely impact our members’ economic situation. We will work closely with our partner multilateral organisations to provide any needed support expeditiously,” it said.
On Wednesday, the World Bank announced that it will stop all its programmes in Russia and Belarus with “immediate effect” in response to Moscow’s military operations in Ukraine and “hostilities” against the people of the war-torn country.
On February 24, Russian forces launched military operations in Ukraine, three days after Moscow recognised Ukraine’s breakaway regions – Donetsk and Luhansk – as independent entities.
The decision comes as a large number of countries, organisations and businesses are severing ties and have imposed sanctions on Russia over the country’s invasion of Ukraine, and with Belarus for its support and cooperation with Moscow.
