Some risks are obvious. Others sit outside the frame: a national interest concealed behind universal rules, environmental depletion missing from economic accounts, currency exposure left unhedged, financial risk buried in product structure, or an illness whose cause remains disputed. What makes these risks dangerous is not only their existence, but the ease with which institutions can ignore them when they are difficult to measure, explain or fit into established categories.
Our first editorial today, “Waiving double standards”, looks at the US’ sanctions policy towards Russian oil. Washington has repeatedly argued for strict limits on countries buying Russian crude oil, yet it has also made exceptions when its own strategic or economic interests are involved. The editorial argues that this selective application weakens the policy’s credibility. The hidden variable is national interest: what is presented as a universal rule is often shaped by the calculations of the country enforcing it. For India, that makes it important to respond — not only to the stated principle but also to the interests driving it.
The second editorial, “Building natural wealth”, turns to what conventional economic measurement leaves out. GDP can record production and income while missing the depletion of forests, water, minerals and other natural assets. Environmental accounts attempt to correct that blind spot by treating natural resources as part of the country’s wealth. The larger point: if depletion is not measured, it can easily be mistaken for growth. Bringing natural capital into public accounting would allow policymakers to see the economic cost of consuming assets that may take decades, or longer, to restore.
Mihir S Sharma’s column, “Let the people hedge”, applies the same idea to forex risk. Indians have genuine exposure to overseas currencies through education, travel, investments and other transactions. Yet policy remains restrictive about allowing individuals to hedge those exposures freely. The risk does not disappear because the hedge is unavailable. It simply remains with the individual. Sharma argues that a more mature forex framework should recognise the exposure people already carry and allow them the tools to manage it.
Debashis Basu’s column, “AT-1 bonds: The bigger lessons”, shows how hidden risk can become visible only after damage is done. Additional Tier-I bonds contain loss-absorption features that many investors may not have fully understood. The Yes Bank episode exposed weaknesses in disclosure, suitability and regulation. Complex financial products are not inherently problematic, but risks buried in technical language or sold to unsuitable investors can create a false sense of safety.
“The mystery of the ‘Havana Syndrome’”, Nicolas Niarchos’ review of Michael Rey and Oriana Zill de Granados’ The Havana Syndrome, looks at uncertainty itself. Years after American officials reported mysterious illnesses, the evidence around their cause remains contested. The difficulty lies in responding to experiences that are real to those affected while the underlying mechanism remains unresolved.
What cannot be easily seen or measured still has consequences, these pieces show. Often, the greater danger lies in pretending that what sits outside the frame does not exist.
