Article
Geopolitical Situation and its Impact on the Indian Economy
India's economy faces growing susceptibility to global geopolitical shocks from the Russia- Ukraine war, West Asia conflicts, US- China competition, and Indo- Pacific pressures, despite vigorous growth protrusions of 7.4% for FY26. This literature review creates impacts across energy- security, trade- force- chain, and fiscal- payments channels, pressing India's 88% crude oil import requirement, $ 825+ billion import base, and remittance flows as crucial exposure points. sanctioned sources like the Economic Survey 2025- 26 and RBI bulletins note downside drawbacks to growth (0.5- 1.0 chance points), pretension harpoons, financial stress from subsidies, and force dislocations in electronics/ pharma/ IT sectors. Studies (Biswas 2023; Chowdhury & Chakraborty 2022) model heightened GDP volatility, trade poverties (e.g., $ 115 billion with China), and capital inflow reversals tied to oil painting-price surges and warrants. Russia- Ukraine goods include elevated import bills (1.2- 1.5 of GDP) and FPI drops (10- 15); West Asia pitfalls logistics via Hormuz; China pressures raise manufacturing costs (3- 4); Indo- Pacific hedging exposes tech- denial pitfalls. Adaptability stems from domestic demand and diversification, but policy needs geopolitical- threat dashboards, stress- testing, and energy- trade buffers for sustained stability.