For MORE than two years most Russian businesses carried on unscathed by the war in Ukraine. A surge in defence spending and subsidised loans for consumers and firms propped up spending at home, even as sanctions curtailed access to foreign markets and inflation jumped. Western companies from Volkswagen, a German carmaker, to Shell, a Dutch oil giant, sold their Russian operations to local enterprises. After an initial tumble, the MOEX, an index of Russian stocks, steadily recovered (see chart).
