In the 21st century, economic sanctions have become a widely used tool to control geopolitics, with the United States being the largest user of sanctions globally, followed by the European Union. Yet, mounting evidence shows that these measures often fall short of achieving their intended diplomatic outcomes. While sanctions are meant to pressure governments by targeting their economies, the actual impact tends to be slow, complex, and frequently ineffective.

In The Great Sanctions Hack, Urjit Patel, former Governor of the Reserve Bank of India, who now serves as Chairman of the National Institute of Public Finance and Policy, evaluates why the concept of sanctions needs a major overhaul. Their broader effects on global markets and unintended consequences for third parties must be considered. Economic damage unfolds gradually, not instantly, and should be tracked in more detailed stages. Moreover, the real cost to individuals, businesses, and global stability needs clearer and more transparent measurement.

Concerns are also rising about the role of international institutions that often fail to fairly assess the consequences of sanctions. This raises questions about their effectiveness in guiding international economic policy.

As global uncertainty grows, a more thoughtful, data-driven, and transparent approach to sanctions is urgently needed.

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