India’s Finance Minister, Nirmala Sitharaman, has assured that the government is vigilantly observing the West Asia crisis’s repercussions on the national economy, focusing particularly on critical areas like fuel, fertilisers, and foreign exchange reserves. Her comments came during an event celebrating the anniversary of the Small Industries Development Bank of India, where she highlighted the troubling rise in crude oil prices and the escalating costs of fertilisers as primary concerns. Furthermore, the finance minister pointed out that the surge in gold prices is adding additional pressure to the economic landscape.
Sitharaman underscored the resilience of India’s economic fundamentals amidst these external adversities, cautioning against panic and emphasizing that fearmongering is not a luxury the country can afford during such global instability. She stressed that the current economic challenges are largely driven by external factors and called for responsible policymaking and clear communication to sustain public confidence.
In a bid to alleviate the burden on consumers, the government recently reduced excise duty on petrol and diesel, a decision Sitharaman noted would result in a significant revenue loss of nearly ₹1 lakh crore. The finance minister also expressed concerns about delayed payments to micro, small, and medium enterprises (MSMEs), with an estimated ₹8.1 lakh crore in pending dues. She urged public sector companies to adhere to the mandated 45-day period for clearing MSME payments.
The ongoing tensions around the Strait of Hormuz, a crucial global shipping lane, have further compounded India’s economic concerns, particularly regarding potential disruptions in the imports of petroleum products and fertilisers. The nation has witnessed a sharp increase in fuel prices recently, with state-run oil companies raising petrol and diesel prices once more on Monday. Since mid-May, there has been an increment of over ₹7 per litre for both petrol and diesel.
Earlier, Prime Minister Narendra Modi had advised citizens to practice prudent spending and avoid unnecessary expenditures amidst the escalating global economic uncertainties linked to the West Asia conflict. His appeal aligns with the government’s broader strategy to navigate these challenging times while maintaining economic stability.