Iran war drives Indian inflation as oil and gas surge
The ongoing conflict in Iran is hitting India's economy hard, especially at the fuel pump.
Since the war started in February 2026, global oil prices have shot up by almost 30% and gas prices by a whopping 75%.
Because India imports about 90% of its oil, these price hikes are pushing up inflation and making everyday things more expensive.
RBI raises inflation forecast to 5.1%
To deal with rising costs, the government has tried cutting fuel demand, limiting gold imports, tweaking taxes, and stepping in to steady the rupee.
Still, things are tight: the Reserve Bank of India now expects inflation to average 5.1% (up from 3.48%) and growth to slow down a bit, while the fiscal deficit is expected to widen beyond targets.
With fertilizer subsidies rising due to drought worries and analysts warning about more financial strain if oil supplies stay shaky, it looks like India will be watching this situation closely for a while.