India's commerce minister Piyush Goyal stated the government is considering measures to address the widening current account deficit and depreciating rupee. While not cutting non-essential imports, citizens are urged to be conscious of import-dependent products, with gold and silver imports seeing significant rises.
S&P Global Ratings believes India is handling global financial challenges better than indicated, with concerns over foreign capital outflows being overstated, despite oil price shocks and rupee record lows.
Pakistan's economy faces sustained pressure with double-digit inflation expected to persist if global oil prices continue rising amid the Middle East crisis. According to Topline Securities, inflation could average 9-10% over the next year, reaching 11% in Q4 FY26 if oil hits $120/barrel. GDP growth for FY27 has been cut to 2.5-3.0% from 4.0%, while the current account deficit could exceed $8 billion. The Pakistan Stock Exchange declined 15% in Q1, reflecting heavy reliance on imported energy.
NITI Aayog's report highlights the Middle East conflict's potential impact on India's trade and economy, risking the current account deficit and exchange rate. Instability also slows India-GCC FTA talks, hindering market access. Despite global uncertainty, merchandise trade remains steady, with services showing strong performance.
