Mumbai, May 18 -- Rising crude oil prices and the ongoing conflict in the Middle East could limit the government's ability to further increase infrastructure spending in the near term, according to a report by HSBC Mutual Fund.

The report stated that the conflict in the Middle East is beginning to exert macro-economic pressure on India through higher crude oil prices and a weakening rupee.

"The Middle East conflict is starting to exert macro-economic pressure on India. Sharp increase in crude price and weaker rupee will be headwinds for FY27 growth if things are not resolved quickly," the report noted.

According to the report, the government is currently absorbing a part of the impact arising from higher energy prices. However, this ma...