I wouldn't be opposed to blocking by referring page, depending on the page, and at the minimum any e-tail company should have IP tracking to know where their orders are originating from geographically. It just seems like a blanket countrywide ban is overkill for the reasons I stated.
I very much doubt Google do any algorithmic penalizing of sites that do this, but don't forget they have mechanisms for manual feedback on the search results quality as well. Who knows what they might do if someone complained? Google even have employees in some of these countries (India, possibly still in China). I can't imagine they're too happy when sites block them on the assumption that they're thieves or pirates.