Summary
In the next financial year, if the demand for petrol and diesel increases by 8 to 10 percent, then the loss in the whole year will reach one lakh crore rupees. 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 it goes beyond $100, inflation will increase even more.
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Expansion
Prices of all goods and products can be affected, due to which domestic inflation will also increase. Japanese research company Nomura also claims, India will suffer the most in Asia in this crisis. According to the report of Soumyakanti Ghosh, Group Chief Economic Advisor, SBI, the price of crude oil in the international market is increasing since November 2021.
However, in India, the government has kept it under control. If the price remains in the range of $100 to $110, then according to the VAT structure, the price of petrol and diesel should be Rs 9-14 per liter more than the current rate. If the government stops the price hike minus excise tax, there will be a loss of revenue of Rs 8,000 crore every month.
In the next financial year, if the demand for petrol and diesel increases by 8 to 10 percent, then the loss in the whole year will reach one lakh crore rupees. 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 it goes beyond $100, inflation will increase even more.
bad effect on exports
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.
every area will be affected
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 in January stood at R 6.01 per cent, the highest in seven months.
new challenges for development
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 damage caused by the pandemic, 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