new Delhi . War means loss is loss. War comes with all kinds of crises ranging from humanitarian to economic devastation. Along with the fighting countries, the countries associated with them also suffer heavy losses. Russia and Ukraine are fighting this but our country located thousands of km away will also have to suffer heavy losses. Due to the war, the price of crude oil has risen sharply to $ 100 per barrel. Due to this, India will suffer a loss of up to one lakh crore rupees.
State Bank of India (SBI) has said this in one of its reports. According to the report, if the war drags on, the revenue of the government may decrease from Rs 95 thousand crore to one lakh crore in the next financial year. At the same time, domestic inflation will also increase. Because the prices of all goods and products can be affected.
Loss of revenue of Rs 8,000 crore every month
Japanese research company Nomura also claims, India will suffer the most in Asia in this crisis. According to the report of SBI’s Group Chief Economic Advisor Soumyakanti Ghosh, the price of crude oil in the international market is increasing since November 2021.
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Although in India, the government has kept it under control. If the price remains in the range of 100 to 110 dollars, then according to the VAT structure, the price of petrol and diesel should be 9 to 14 rupees more per liter than the current rate. If the government stops the increase in price minus excise tax, then there will be a loss of revenue of Rs 8,000 crore every month.
direct impact on inflation
If the demand for petrol and diesel increases by 8 to 10 percent in the next financial year, then the loss will reach one lakh crore rupees in the whole year. These prices will have a direct impact on inflation. Oil prices rose from $63.4 in April 2021 to $84.67 in January 2022, an increase of about 33.5 percent. If this shift goes to $100, then inflation will increase even more.
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Even though India’s strategic interests are not associated with this war, but there will be an economic impact. Services to Europe will be negatively impacted. The sanctions on Russia may also affect tea and other regular products exported from India.
Ukraine big exporter of agricultural products
Prices of precious metals like gold, platinum and palladium will increase. Ukraine is a major exporter of agricultural products. If imports stop, the prices of cereals like wheat and corn may increase. Inflation stood at R 6.01 per cent in January, the highest in 7 months.
The Ukraine-Russia war has brought major challenges to global peace for the first time since World War II. This situation will also present new challenges for the development of India. After the economic loss caused by the epidemic, there is improvement now. War of such a large scale is creating new challenges not only for world peace but also for us. -Nirmala Sitharaman, Finance Minister
Tags: Crude oil, Crude oil prices, inflation, Russia, War
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