Ukraine: Avoid China & India? Tell Us What You Think

Fri 11 Mar 2022

By Brian Dennehy

Access Level | public

Market commentary


Magnifying GlassIn the light of Russian barbarism in Ukraine we believe some action is required on our part over and above our normal investment criteria. 

You will have noticed that neither India nor China, the world’s most populous nations, are supporting sanctions against Russia, the only pressure which the world can bring immediately to bear short of going to war with Russia.

We have been content investing into India and China for over 20 years.  From time to time political events in both countries, China most recently, might have prompted some investors to jump ship.  We did not do so because it would have been very blinkered to do so in isolation.

For example, it would logically mean that you should also have sold all US funds.  There were around 250,000 civilian deaths in Afghanistan and Iraq with the US army in situ (source Costs of War Project, Brown University).

On this occasion there is no wiggle room, no scope to sit on the fence, at least not for us.  Yet China and India have chosen to sit on the fence – they are not prepared to condemn Russia's action, nor to support sanctions of any kind.  We believe this is indefensible.

There is more than £40 billion invested across India and China funds by retail investors in the UK (source Analytics).  Every penny of that money helps oil the wheels of the economy of a country which is content to continue dealing with Russia*.

Therefore, if you hold India or China funds, we are recommending selling these if your perspective is similar to ours.

Of course, this is a small step by you and us.  We will be seeking to get the whole of the adviser community in the UK to bring this very serious matter to the attention of their clients. 

We are very happy for you to forward this on. 

* The EU is still not doing everything it can – purchases of Russian gas are still financing the Russian war machine.  But they are at least moving in the right direction supporting other sanctions.





Market commentary


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