Dehradun, July 25 -- India managed quite well to overcome the first shock caused by the West Asia conflict. However, the conflict is escalating again -marked by severe blockades in the Strait of Hormuz - posing a major downside risk to India's macroeconomic stability, primarily through energy price shocks, trade disruptions, and fiscal strain. Despite these external shocks, the Reserve Bank of India (RBI) and government updates indicate that India's economic fundamentals remain cautious but resilient, supported by a strong 7.7% GDP growth in FY26 and robust foreign exchange reserves.
The energy shock and consequent imported inflation will cause crude vulnerability, as India relies on imports for nearly 88% to 90% of its crude oil requireme...