• What is the impact of global uncertainty on India? Notwithstanding the shortcomings of the BJP government, the people of India must express gratitude to the govt for protecting them from impact of the current geopolitical situation. This is the time to support a stable India and support peace not war.

Wars in the Gulf are part of daily headlines. First, it was Israel/USA vs. Iran and now Houthis vs. Saudi Arabia. Thanks to the Mecca Agreement, Turkey and Pakistan are involved in defending Saudi. The Russia Ukraine war that started in 2022 continues. Deaths and destruction of infrastructure hurts. Rebuilding will be time-consuming and expensive. Arms sellers are running all the way to the bank. The U.S. takeover of Venezuela was relatively peaceful.

To this add the public (some say political) uprising in Sri Lanka, Nepal and Bangladesh. Lots of violence.

Those who asked, why a 4 day Operation Sindoor might realise the behind keeping wars short esp. after seeing impact of the Russia/Ukraine and U.S./Iran wars. Russia has lots app 40% of its oil refining capacity. Ukraine is hit too. The U.S. debt GDP ratio and debt have leapfrogged-cumulative effect of many wars.      

Crude Prices Trend and Interest Rates - Impact

Crude oil prices surged from $ 82.1 in October 2021 to about $ 102 in September 2026. Initially, crude prices were stable as Russia entered the market in a big way. The U.S. allowed as it did not want prices to leapfrog. Later, the U.S. imposed sanctions on buying Russian oil that limited oil supplies and increased transportation/insurance cost too. India increased the number of countries from which it buys crude. Meanwhile fertiliser, edible oil, LPG prices were up with supplies uncertain.

Read   How did the Russia Ukraine war impact India “Surging costs for fuel, fertilizers, and edible oils - particularly sunflower oil imported from the Black Sea region.” Also read  

India’s current account deficit went up because of higher oil prices. FII’s continued to exit India’s stock markets. In metros, heard of many Indians who live overseas selling off their inheritance (shares and property) and transferring the money to their country of permanent residence. Hope the Reserve Bank of India can quantify and track this. This contributes to demand for the rupee. 

Meanwhile, interest rates in the U.S. continued to climb. According to a Business Standard report by K Kant dated 8/10/26 the yield on U.S. treasurer bond was 5.35% (25 year high) up from 4.08% at the end of October 2025. India’s 10 year bond yield was 7.29% (highest since December 2023). The spread between the two is 1.94 (7.29-5.35) as against an average spread of 392 bps on average in the last ten years. 

Rise in bond yields affects India in two ways wrote TT Ram Mohan in the Business Standard. One, investors find it more attractive to invest in the U.S. adversely affecting flows into emerging markets like India. Two, a low spread of 194 basis points also contributes to the downward pressure on the rupee. Note bond yields are outside the control of the government of India.

Thus, multiple factors forced rupee depreciation. It made the government go in for the FCNR scheme. Since deposits before August 31 are protected in dollar terms, how expensive this move will prove shall be known in the years to come.

Crude Prices chart. Courtesy Hindustan Times/CMIE.

Read   The Impact of Crude Oil Prices on India

Amidst global uncertainty the Government of India has done well to diversify crude oil supplies, maintain Russian oil imports, (reduces average purchase price of crude) ensure supply of fertilisers (highly subsidised), a GDP rate of over 7% and keep inflation under control (not double digit like in 2013). Read  How Agile Policy kept the Economy Moving Vandana Hari, Singapore based analyst

Amidst this, the U.S. passed a bill that empowers the government to impose sanctions of up to 100% on countries that buy Russian oil. Uncertainty! The 12 odd percentage deficit in India’s rainfall added to the uncertainty on food grain production.

UNCERTAINITY GALORE

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Inflation in India is closer to 5% although sections of the media go ballistic every time onion and tomato prices go up. They fail to tell impact on monthly budget as if onions and tomatoes is all that people eat. If consumers eat vegetables by season prices are likely to be lower. As a regular online buyer, can say it mostly reduces purchases cost though 10 minute delivery purchases are likely to be expensive.  

These wars have exposed India’s vulnerability-how dependant it is on the Middle East etc for key supplies. This dependence is not a recent phenomenon. 

The people of India are either ignorant or do not comprehend the impact of the international situation.

They expect the economy and stock markets to be on a non-stop upward trajectory and appear to be unwilling to share some of the financial pain. They protest too much when there was an increase in petrol prices or a small fee levied on use of UPI.

Yet, this BJP government has erred too.

It is too busy with SC/ST/OBC Reservation, has failed to effectively manage NEET exams and bring out a change in the education system even in centrally controlled institutions like the IITs. Even a good move like incorporating 20% ethanol in petrol was badly communicated.

In twelve years BJP could have introduced a transparent pricing policy for petroleum products. It is thus difficult to correlate an increase in international oil prices with what the Indian consumer finally pays. The loss to Oil Marketing Companies (OMC) is notional as it is decided on the Import Parity Pricing (IPP). My 2006 article

The days of pushing decisions, without explaining benefits and addressing public concerns, have ended. The Internet has given people a voice. It is used to protest against government policies and biased writings in mainstream media. 

The BJP has also failed to make the public know what state governments are responsible for? It makes people believe it will resolve all of India’s problems.

Read   1. What is the role of Central and State governments in EDUCATION – even though it is on the Concurrent List in the Colonial Constitution, it is essentially a State responsibility esp. primary education. With States in Freebie mode, it leaves lesser resources for services like education, health and irrigation.  

2. What are Fundamental DUTIES under the Indian Constitution And 3. Why was NEET introduced and mandated by the Supreme Court – at the height of the NEET protests, Ministers failed to tell the people of life before NEET and that NEET was introduced on the orders of the Supreme Court. This failure allowed vested interests to have a field day altering the narrative to suit them.  

Communicating with India and Bharat

After 12 years of being in power, people are not interested in knowing what the Congress did not do but ask what the BJP has done. The government has failed to make Indians realize the enormity of its efforts to protect the Indian consumer from global uncertainty esp. in 2026.

I saw some good interviews by Sanjeev Sanyal (PMO) and Chief Economic Advisor Nageshwaran but they are Technocrats. The BJP needs its politicians to communicate. The BJP is missing the two Aruns. Arun Jaitley (spoken) and Arun Shourie (written). Using the social media to manage the narrative is good but good old spoken words and articles are as important.

In a nation or corporate change is accepted when its need and benefits are communicated clearly. Not responding to President Trump’s near daily tweets is good strategy but affecting change within India needs a different approach. 

The people of India are crying for change and accountability, hence the current wave of protests even though some are politically motivated. Students are no longer willing to accept paper leakages in state level public service commission exams – protests in Jharkhand and Maharashtra are a pointer. 

The Supreme Court, though well intentioned, mostly complicates matters because Judges neither have experience in governance nor are trained for it. Even though some PIL’s are politically motivated, ordinary citizens also approach the Higher Judiciary when the Executive fails to deliver or explain a decision logically. The SC has to guard against being used by political parties! 

The impression is that this BJP government sees everything through the caste and votes prism. Hope am wrong. For how long can the BJP expect Rahul Gandhi to campaign for it? He has realized his folly, witness his aggressive avatar.

Read  Is Government Spending on SC and ST, based on Colonial concepts

India is going through a transition where the youth are more demanding due to rising aspirations and a realization that their future is linked with India’s. 

Express Gratitude  

Notwithstanding the shortcomings of the present BJP government, the people of India must express gratitude to the government for protecting them from the impact of the existing geopolitical situation.

It must support the government’s intent to promote peace and avoid war. A war at this stage of India’s development is what its enemies want. Such a war would have a disastrous impact on India.

Those who are protesting against the present government have every right to protest but hope they realize that during uncertain times the country needs a stable and experienced government.

India must realize something about the Middle East nations, unlike Indonesia. These countries are perpetually at war with each other, for one reason or another. Brotherhood is not remembered.

India is stable because it is dominated by Sanatana Dharma – the day that changes India might become like the Middle East and U.S.A.  

Also read

1. How did the Russia Ukraine war impact India

2. Is Government Spending on SC and ST, based on Colonial concepts

3. Why was NEET introduced and mandated by the Supreme Court

4. What are Fundamental DUTIES under the Indian Constitution

5. What is the role of Central and State governments in EDUCATION

6. How Yoga helps deal with Uncertain Times

7. The Impact of Crude Oil Prices on India