Gita Gopinath: Sanctions risk driving gold rush in China-led bloc

The Indian-origin economist said that economies are reevaluating their trading partners based on economic and national security concerns following disruptions such as Covid-19 pandemic and Russia’s invasion of Ukraine. Economists have dubbed this phenomenon 'trade fragmentation'. She said that trade fragmentation is much more costly this time around, compared to the cold war. That's because the goods trade to GDP ration stood at just 16% at the start of the cold war. That ratio now stands at 45%. Higher the ratio, lesser is the trade.