New Delhi, May 12 -- India's economic and policy leadership is bracing for the fallout from the West Asia war, with senior officials cautioning that elevated oil prices and supply disruptions could strain inflation, the current account and the rupee. At an industry conference in New Delhi, ministers and officials pushed for tougher fiscal discipline, deeper deregulation and a shift toward globally competitive manufacturing.

At the Confederation of Indian Industry's annual business summit on Tuesday, petroleum minister Hardeep Singh Puri pointed to the stress on state-owned fuel retailers from the global energy shock, which chief economic adviser V. Anantha Nageswaran said poses a "live macroeconomic stress test". Niti Aayog member and ch...