“We’ve continued to see emerging markets negotiate deep discounts on Russian oil which keeps oil in the global market but sharply reduces the Kremlin’s take,” she said.
“The way I see it, our sanctions have had a significant negative effect on Russia so far. While by some measures, the Russian economy has held up … Russia is now running a significant budget deficit,” she added.
Yellen pledged an additional $10 billion in economic support to Ukraine, besides the $45 billion assistance approved by Congress in December. She also expressed optimism that the International Monetary Fund would “move swiftly” toward a robust, new financial assistance program for Ukraine.
In response to a question about India and China’s neutrality in the war, Yellen said that the G-20 official communique in Bali last year contained strong language on the invasion and she expected the same this year.
China, however, has repeatedly condemned U.S. and NATO actions for provoking the war. India meanwhile, announced last week that its trade with Russia has grown by 400 percent since the invasion with imports of Russian crude oil at all-time highs.
While Yellen boasted on Thursday that the price caps had dented Russia’s war chest, Western-led sanctions and other penalties have been offset by countries that have ramped up their economic ties with Russia, particularly by taking advantage of discounted prices for Russian oil but also by selling microchips and other necessities Russia can no longer buy from the West.
She encouraged G-20 countries to also find solutions to debt and economic distress in low-income countries, especially Zambia, Sri Lanka, and Ghana.
She added that her meeting with Chinese counterparts was “constructive” on issues of food security, debt and climate change, calling communication with China “necessary and desirable.”
“These are all matters of global significance where we do have the ability to cooperate,” she said. “I believe it’s important to do so and am open to having those conversations.”
Yellen’s speech kicks off her series of G-20 meetings alongside roughly 500 foreign delegates — primarily finance and central bank officials — in Bangalore to discuss issues including debt, climate finance and cryptocurrency. On Saturday, Yellen will convene a technology roundtable with American and Indian executives.
Before her speech, Yellen met with Indian Finance Minister Nirmala Sitharaman to discuss cryptocurrency, debt issues and energy transitions.
In an International Monetary Fund release, adopting and championing India’s tagline of “One Earth, One Family, One Future,” IMF chief Kristalina Georgieva called India a “bright spot” during a time of uncertainty.
The IMF expects emerging and developing markets to account for four-fifths of global growth this year, with 15 percent just from India itself.
Along with highlighting issues of food security, climate finance, and inflation, she added that higher borrowing costs are exacerbating debt issues. The World Bank and the IMF will participate in a Global Sovereign Debt Roundtable in Bangalore this week to address these issues.