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CEA says worst may be behind India on Iran shock
NDTV··12 Jun
NDTV reported that Chief Economic Adviser V Anantha Nageswaran said the worst may be behind India in terms of the US-Iran conflict's economic impact. He cited strong domestic demand and a likely 12 percent nominal GDP growth rate as reasons for relative calm.
Prism
What It Means For You
- Strong domestic demand can protect jobs and revenues even when global shocks hit.
- Oil prices remain the biggest risk for inflation, fiscal pressure and growth forecasts.
- Government optimism should be weighed against contingency planning for renewed conflict.
What's Happening
- CEA Nageswaran said India's worst impact from the conflict may be behind it.
- He expects nominal GDP growth closer to 12 percent than the budget's 10.1 percent assumption.
- He still warned that high oil prices could create downside GDP risks.
Macro Cushion
- Nominal GDP growth affects tax revenue and fiscal calculations.
- India benefits when crude prices ease and urea availability improves.
- Geopolitical shocks can move from energy prices into inflation, current account and growth.
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