India needs to brace for lasting changes amid changing geopolitics and energy shocks, finance industry leader Uday Kotak has said. The global order, amid the US-Israeli war on Iran, is moving towards a “tribal” mindset and Indian companies need to think in terms of long-term national strength, the Kotak Securities chairperson added.
“We have not seen the impact in the last two months of the Middle East (West Asia) war in terms of energy price transmission,” Kotak said, speaking at the CII Annual Business Summit 2026 in Delhi.
“It’s coming, and it’s coming big, and consumers have not felt the pressure at all. Oil companies had the ability to be the shock absorber, and it’s a large amount of money,” he said.
‘Prepare for paranoia’
Kotak said India should avoid complacency and be more cautious. “My view is we should prepare for paranoia before the event,” he said, adding, “We must prepare for the worst.”
He warned that India’s heavy dependence on imported oil (over 85% of its needs) makes the economy vulnerable to global price shocks, which can impact inflation, the rupee, and overall financial stability.
“Be ready for tough times, rather than waiting for the shock to hit us,” he said. “The shock is coming. I don’t think you’re very far away from the shock unless the Iran war stops tomorrow morning and we have been hoping for it since February 28,” he added.
What the government said
Union petroleum minister Hardeep Singh Puri earlier spoke about this during the summit. He said that oil marketing companies are currently losing ₹1,000 crore every day to keep pump prices steady as global crude benchmarks have surged from $65 to nearly $115 per barrel.
Under-recoveries for the first quarter are projected to reach ₹1.98 lakh crore. He added that while the past 70–75 days have been difficult due to global disruptions, India has managed to maintain uninterrupted energy supplies.
Kotak added that India needed stronger financial discipline at both the government and corporate level. According to him, the country’s economic strength will increasingly depend on how effectively it uses its resources and builds resilient companies over time.
He also said that businesses in India are overly focused on short-term performance cycles. “The ability to take a 3-5 year view is significantly required, and is missing,” he said, asking companies to focus less on stock price movements and short-term incentives.
Enough supplies amid war
Despite the mounting costs, the government has moved to reassure the public. Following the fifth meeting of the Informal Group of Ministers (IGoM) chaired by Defence Minister Rajnath Singh, the government confirmed that India maintains a comfortable buffer.
Crude oil and natural gas stocks cover around 60 days of demand and LPG supplies providing roughly 45 days of rolling cover. The country’s foreign exchange reserves stand at about $703 billion.
Prime Minister Narendra Modi has still appealed to the public for austerity. Speaking in Gujarat and Hyderabad, the PM asked citizens to reduce fuel consumption, adopt work-from-home practices, and hold off on buying gold to ease the nation’s fiscal burden.
What the Opposition said
Opposition leaders have stepped up criticism. Senior Congress leader Jairam Ramesh interpreted the PM’s Hyderabad remarks as a warning of tougher measures to come. “A phase of stringent cost-cutting measures, including a hike in fuel prices, may be on the horizon, and an atmosphere is being created to make them more acceptable,” he said.
Samajwadi Party chief Akhilesh Yadav questioned the timing of the government’s appeals, asking why the issue of economic strain has surfaced only after recent elections in four states and a Union Territory. “During the elections, BJP leaders took thousands of chartered flights. Were those planes flying on water?” he asked.
