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War, Oil & Economy: Big Risks Ahead for India Explained

| Mar 19, 2026, 03:36:35 PM | TOI.in
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India’s rare ‘goldilocks’ phase of low inflation and high growth is now under threat as rising crude oil prices triggered by escalating geopolitical tensions begin to ripple through the economy. With oil crossing $100 per barrel, risks are emerging across key macro indicators: inflation may rise due to costlier imports, GDP growth could slow as consumption and investment weaken, and the current account deficit may widen sharply. A weakening rupee, pressure on fiscal balances through higher subsidies or tax cuts, and disruptions to trade and remittances from the Middle East further complicate the outlook. While India’s structural strengths remain intact, the duration of the conflict will be crucial in determining how deep and prolonged the economic impact becomes.

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