S&P dims growth forecast for India

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WHAT WE’RE TRACKING TODAY

India’s Russian oil imports surge by nearly 150% in March

Good afternoon, readers. We lead today’s light issue with S&P’s latest GDP forecast for India, which sees a decline in India’s GDP growth if oil prices remain above USD 100 / bbl.

Meanwhile, Russian barrels contributed significantly to India’s crude mix, with state refiners increasing imports by 148% m-o-m to replace GCC supplies.

On the war front: As the ceasefire continues to hold, India has stepped up its diplomatic engagement from Washington to the GCC while calling for open and unhindered access to the Strait of Hormuz. Let’s dive in.

Watch this space

ENERGY — Russian crude gains in Indian crude mix: Oil purchases from Russia jumped 148% m-o-m in March as Indian state-owned refiners doubled down on a temporary US sanctions waiver to replace Gulf barrels, according to data from the Centre for Research on Energy and Clean Air (Crea). The surge coincided with a net 4% decline in India’s total oil imports on the back of the US-Israel war on Iran.

Why it matters: The surge coincided with a 30-day US waiver, which expired on Saturday, prompting opportunistic buying to maintain buffer stock amid disruptions in the Strait of Hormuz. India imported fossil fuels worth EUR 5.8 bn from Russia in March, with crude accounting for 91%. Russian crude, even at narrowing markdowns, is currently the most reliable option for Indian refiners given supply cuts from the GCC.

State refiners lead surge: State-run refiners including Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation drove the spike, reversing earlier cutbacks under pressure from Washington. State-owned New Mangalore and Visakhapatnam refineries resumed Russian sourcing after a pause triggered by the sanctions. “Their [state refineries] imports were 72% higher than March 2025, presumably due to Russian barrels being more available in the spot market, which serves as the primary source of imports for them,” Crea said.

Private refiners such as Reliance Industries and Nayara Energy lifted purchases by 66% m-o-m. However, their numbers remain lower compared to March 2025.

Price gains: “In March 2026, the average price of Russia’s Urals crude rose astronomically, up by 67% to USD 94.5 / bbl, remaining more than double the updated EU and UK price cap of USD 44.1 / bbl,” Crea stated.

IPO WATCH — At least 37 IPOs collectively seeking to raise INR 440 bn (USD 5.3 bn) from India’s equity markets could opt for a delayed listing amid market volatility caused by the Iran war, Fortune India reports.

Why it matters: India’s capital markets regulator, the Securities and Exchange Board of India, has allowed IPO-bound companies that have already secured regulatory permissions to delay their listings to avoid weak debuts amid a declining streak in the Indian equity market. The regulator's move protects issuers from costly refilings and gives them flexibility to wait for better market conditions, as a sentiment of rising risk aversion and subdued investor participation lingers due to the war.

Despite market volatility, India’s IPO pipeline remains sizable, with over 144 companies sitting on regulatory approvals to raise roughly USD 18.7 bn this year.

TRADE — The India-Oman comprehensive economic partnership agreement (CEPA) will take effect on 1 June, Goyal told The Hindu.

REMEMBER- The India-Oman CEPA, inked in December, grants near-universal zero-duty access on over 98% of tariff lines and covers more than 99% of Indian exports by value. The pact also opens 127 services sub-sectors, allowing 100% foreign ownership for Indian firms in key sectors, and eases mobility for professionals, positioning Oman as a gateway for Indian companies into wider MENA markets.

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Data point

INR 2.05 tn (USD 22 bn) — that’s the projected size of India’s data center market by 2030, compared to USD 10 bn in 2025, Economic Times reports.

IN CONTEXT- Installed capacity is projected to increase to around 5 GW by 2030 from up to 2.0 GW by 2026, supported by rising data usage and continued expansion of digital infrastructure. Investment activity in data centers has accelerated alongside this demand, with USD 13-15 bn deployed between 2020 and 2024, largely led by foreign institutional investors. Newly announced projects in the pipeline total USD 60-70 bn over the next five years, pointing to sustained capacity additions.

The big story abroad

Washington’s naval blockade on Iran is still in effect and bilateral talks “could be happening over next two days,” US President Donald Trump said overnight. A major sticking point will be Iran’s nuclear ambitions. Washington reportedly proposed a 20-year “suspension” of all nuclear activity — not just a permanent ban of nuclear enrichment. Iran is holding out for a five-year suspension of work on anything nuclear.

The US blockade of Hormuz has tankers stopping or turning around, the FT notes.

Pressure on Tehran is mounting, with Washington deciding not to renew a 30-day waiver of sanctions — set to lapse this Sunday — on Iranian oil at sea, Reuters reports. The waiver has allowed roughly 140 mn barrels of oil to reach global markets.

Lebanon and Israel held their first direct diplomatic talks in decades on Tuesday in Washington, which the US State Department called a “historic milestone.” Iran-aligned Hezbollah was not represented at the sit-down and has long opposed direct talks with Tel Aviv.

MEANWHILE- US banks are breaking earnings records as 1Q financials come out. Investment banks capitalized on a volatile first quarter marked by US intervention in Venezuela and the war on Iran. JPMorgan Chase delivered its highest-ever top line figure, while Citi turned in its best quarterly revenue in a decade.

Circle your calendar

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays, and news triggers.

S&P flags up to 80 bps hit to growth if oil prices stay elevated

S&P Global Ratings projects a moderate slowdown in India’s GDP growth, estimating a hit of up to 80 bps if oil averages around USD 130 / bbl this year, according to a note. Strong macroeconomic and financial sector parameters are likely to help the economy absorb the impact of sustained high oil prices without immediate financial instability.

Why it matters: “India isn’t immune to the shocks reverberating from the Middle East war. The pain of higher energy prices and supply disruptions may persist for months, crimping economic activity across households, corporations, and banks,” the rating agency warned.

The mitigants: Despite these headwinds, S&P expects strong corporate balance sheets, well-capitalized banks, and a resilient external position to provide adequate buffers against the worst of the fallout. India’s economy entered 2026 with strong growth momentum, resilient domestic demand, and low inflation, which — combined with potential government support — should help absorb the near-term shocks.

The stress test: S&P assumes crude at USD 130 / bbl in 2026 and around USD 100 in 2027, versus a base case of USD 85 and USD 70. At these levels, sustained energy costs and supply disruptions are expected to weigh on demand and slow down economic activity.

Higher crude prices are expected to raise input costs, push retail prices up, and widen the current account deficit. S&P estimates that every USD 10 / bbl increase could expand the deficit by about 0.4 percentage points of GDP, while depreciating the INR.

Rating steady, but fiscal risks linger: The rating agency does not expect any immediate impact on India’s sovereign rating, though it cautioned that fiscal consolidation efforts could face temporary setbacks.

Inflation rose in March

India’s retail inflation inched up to 3.4% y-o-y in March from 3.21% in February, remaining below the Reserve Bank of India’s (RBI) 4% target, according to a press release. The uptick was driven by 3.8% food inflation in March versus 3.4% a month earlier.

Wholesale price inflation (WPI) rose to 3.8% y-o-y in March, its fastest pace in over three years, driven by higher prices of oil, food and manufactured products, according to government data. The WPI in February was 2.1%.

War ripples hit India’s auto sector

India’s auto sector is bracing for near-term disruption as the Iran war begins to ripple through costs and supply chains, according to a Society of Indian Automobile Manufacturers report. The industry body flags risks from rising crude prices, higher input costs, currency volatility, and shipping disruptions.

Cost pressures build: Elevated oil prices are expected to push up fuel and logistics costs further, while higher commodity prices and freight rates could squeeze profitability across manufacturers and suppliers. A “stable geopolitical environment will help build confidence [in] the industry, which can in turn drive further growth,” the report said.

Why it matters: In FY 2025-26, India shipped over 5.3 mn vehicles globally. The Middle East held its spot as India’s third-largest export region, accounting for approximately 18% of all passenger vehicle exports, trailing Africa at 28% and Latin America at 25%. While buyer interest remains strong, especially in entry-level segments, conversion to actual sales is slowing. Export volumes may also come under pressure as global trade routes face disruptions, Reuters reports, citing analysts.

Sector resilience holds: The concerns follow a strong FY 2026, with passenger vehicle sales rising 7.9% to 4.6 mn units and two-wheeler sales up 10.7%, supported by earlier tax cuts. The current situation underscores the need for diversified supply chains and energy sources, as prolonged geopolitical stress could test the sector’s growth momentum, analysts told the newswire.

Modi, Trump stress Hormuz access as US blockade disrupts flows

Modi, Trump stress keeping Hormuz open

Indian Prime Minister Narendra Modi and US President Donald Trump emphasized the need to keep the Strait of Hormuz open and secure during a roughly 40-minute call, according to a post on X.

Why it matters: The call came a day after the US ordered a naval blockade of Iran’s ports and coastal areas, which will impact India’s efforts to secure shipments through the strait. While New Delhi had worked its diplomatic channels with Tehran to secure a gradual and coordinated passage of India-bound fuel shipments during the war, Trump’s blockade will upend that arrangement and disrupt the import of Iranian energy supplies. Both New Delhi and Tehran have said that Indian ships did not pay a toll to cross the waterway.

IN CONTEXT- At least eight India-flagged merchant ships crossed the Strait of Hormuz under the India-Iran diplomatic arrangement before the ceasefire, while one more reportedly crossed after the ceasefire was announced. Fifteen other Indian vessels remain stranded in the waterway.

ALSO- India’s External Affairs Minister S Jaishankar spoke with Israeli Foreign Minister Gideon Sa’ar and Australian Foreign Minister Penny Wong to discuss developments in the Middle East following the US-announced blockade, he said on X (here and here).

Commerce minister reaches out to the GCC

Dial Kuwait and the UAE: India’s Commerce Minister Piyush Goyal has ramped up engagement with Gulf counterparts, including Kuwait’s Commerce Minister Osama Khaled Boodai and the UAE’s Foreign Trade Minister Thani bin Ahmed Al Zeyoudi, to restore disrupted supply chains and coordinate action to stabilize logistics, with India offering support on food security and trade continuity.

In parallel, he held talks with GCC Secretary General Jasem Mohamed Al Budaiwi and Bahrain’s Commerce Minister Abdulla bin Adel Fakhro, centering on predictable trade routes and alternative logistics.

Corridor under strain: India-Gulf trade, valued at USD 178 bn in 2024/25, is currently under strain — disrupting sectors including petroleum, rice, gems and jewelry, and pharma. The intensified diplomatic outreach hints at India’s urgency to secure Gulf supply chains.

RMZ Group unveils USD 35 bn investment plant

Bengaluru-based real estate and infrastructure developer RMZ Group is evaluating an IPO as part of a five-year USD 35 bn investment plan to build long-term capital for expansion across data centers and commercial real estate, Business Standard reports.

Capex strategy: The investment will be split evenly between real estate and digital infrastructure, including colocation data centers and AI factories. RMZ is targeting 1.5 GW of data center capacity with up to USD 15 bn in investment. Additional capital is earmarked to develop platforms offering graphic processing units as a service. On the real estate side, RMZ is expanding office assets — driven by global capability centers (GCCs) — alongside hospitality, logistics, and residential projects across key Indian cities.

Who are they? The firm mainly serves the GCCs of multinational firms with office parks across Bengaluru, Mumbai, and Hyderabad. It is also expanding into logistics, hospitality, and residential platforms — all integrated in a single location. The group works with sovereign funds and pension investors and has set up a JV with London-based Colt Data Centre Services to invest USD 1.7 bn in the Indian data center market.

Why it matters: India generates 20% of the world’s data but has just 2% of data center capacity, creating a large infrastructure gap, RMZ told Reuters. An IPO would provide the real estate major with long-term funding to compete in capital-intensive segments like AI infrastructure while diversifying funding beyond debt — as global tech giants and domestic conglomerates ramp up their data center pledges in India.

BEML lands INR 3 bn Middle East order

BEML secures INR 3 bn Middle East order

Bengaluru-based engineering firm Bharat Earth Movers (BEML) secured an export contract in the Middle East worth INR 3.03 bn (USD 36.38 mn) to supply heavy earthmoving equipment, Hindu Businessline reports. BEML equipment will be used in infrastructure development and reconstruction-related projects.

Tata steps up iPhone manufacturing investment

Indian conglomerate Tata Group is investing INR 15 bn (USD 160 mn) into Tata Electronics to support its iPhone manufacturing business, Economic Times reports. The funding forms part of ongoing capital support from the parent firm to expand its smartphone production capacity. With the latest round, total capital infused into Tata Electronics stands at INR 30 bn (USD 321 mn) in FY 2026.

IMF trims global GDP forecast with dispersed war scenarios

The IMF has revised down its global growth forecast to 3.1% for 2026 from the 3.4% projected in January, according to its recent World Economic Outlook report (pdf). Without the war, the IMF says global growth would have been revised upward due to strong technology investment and resilient productivity resulting from AI adoption.

The MENA region faces the most significant downgrade of 2.8 percentage points to a 1.1% growth rate in 2026, from a previous forecast of 3.9%, highlighting a hardening regional divide amid war. Saudi Arabia’s growth forecast was slashed down to 3.1% in 2026, a major 1.4 percentage points decrease from the Fund’s January projection. However, growth is expected to pick up pace again to 4.5% in 2027, up by about 0.9 percentage points from the January forecast.

The UAE's 2026 GDP growth projection was also cut to 3.1%, down from 5% in the Fund’s October projection. Egypt’s GDP forecast was also revised down to 4.2% in 2026, a 0.5 percentage points decrease from its January projection. Meanwhile, growth is anticipated to rebound in 2027 to reach 4.8%.

Global inflation forecast was raised by 0.7 percentage points to 4.4% in 2026, citing a double-tap of higher energy and food prices. The likelihood of maintaining elevated interest rates for an extended period is now higher than indicated by the October 2025 projections.

Dark scenarios

The IMF’s “adverse scenario” sees the global economy slashed by 0.8 percentage points off global growth in 2026, dragging it down to 2.5%, while sending headline inflation to 5.4%. This scenario envisions the global economy choked by a sudden 80% spike in oil prices and a 160% surge in Asian and European gas prices.

The real danger lies in the IMF’s “severe scenario.” A global recession — will see a persistent 100% surge in oil prices in 2Q of 2026 and a 200% spike in gas prices — would choke global growth down to just below 2%, a level seen only during the global financial crisis and the pandemic. The impact is structurally deeper and more persistent, with inflation skyrocketing up to 6.1% by 2027, forcing the Fed to hike rates by 100 bps.

Credit pain to hit emerging markets

Emerging markets — excluding China — would face a violent repricing of risk in the worst scenarios. Sovereign spreads are projected to widen by up to 100 bps, while corporate premiums could jump by as much as 200 bps. This freezes the capital flows MENA firms rely on for survival.

This time is different: Central banks won’t have the luxury of cutting rates to support growth, and instead, they will be forced into mandatory tightening to anchor inflation expectations, leaving the private sector to navigate a high-cost, low-liquidity environment alone, the report said.

MARKETS THIS MORNING-

Signs of diplomatic engagement by regional and global powers helped calm markets earlier today. This was felt by Asian markets, with Japan’s Nikkei rising around 0.6%, South Korea’s Kospi gaining 2.8%, and MSCI’s broad gauge of Asia-Pacific shares — excluding Japan — reaching its highest level in six weeks. US futures are broadly trading flat.

Sensex	78,122	+1.6% (YTD: -9.8%)
NIFTY 50	24,230	+1.6% (YTD: -7.3%)
ADX	9,898	+0.6% (YTD: -1.5%)
DFM	5,848	+2.2% (YTD: -5.4%)
Tadawul	11,575	+0.7% (YTD: +9.4%)
EGX30	50,411	+0.8% (YTD: +20.5%)
Boursa Kuwait	8,119	+1.4% (YTD: -3.5%)
QSE	10,757	+0.6% (YTD: -0.6%)
S&P 500	6,967	+1.1% (YTD: +1.7%)
FTSE 100	10,615	+0.06% (YTD: +6.8%)
Euro Stoxx 50	5,968	-0.2% (YTD: -3.3%)
Brent crude	USD 95	+1.1%
Natural gas (Nymex)	USD 2.60	-0.1%
Gold	USD 4,798	-0.9%
BTC	USD 73,949	-0.7%

The values in the table above are listed according to the market position as of 3:30pm IST / 2pm GST.

CALENDAR

APRIL

15-17 April (Wednesday-Friday): Entrepreneur Tech & Innovation Summit, Bengaluru.

22-24 April (Wednesday-Friday): RenewX, Chennai Trade Centre, Chennai.

MAY

1 May (Friday): Buddha Purnima.

26 May (Tuesday): Eid Al Adha.

JUNE

15-17 June (Monday-Wednesday): Prime Minister Narendra Modi to attend G7 Summit in Evian, France.

18-21 June (Thursday-Sunday): Bharat Buildcon, Yashobhoomi, Dwarka, Delhi.

24-25 June (Wednesday-Thursday): India Homeland Security Expo, Bharat Mandapam, Pragati Maidan, New Delhi.

26 June (Friday): Muharram.

Signposted to happen sometime in 1H 2026:

Signing of India-Qatar FreeTrade Agreement (Details yet to be announced);
India-EU Trade and Technology Council Ministerial Meeting, Brussels, Belgium;
India to host the Brics Summit.

JULY

1-3 July (Wednesday-Friday): Seafood Expo Bharat, Chennai Trade Centre, Chennai.

3-4 July (Friday-Saturday): Rail & Transit Expo (RailTrans), Bharat Mandapam, New Delhi

8-10 July (Wednesday-Friday): India Energy Storage Week, New Delhi.

14-17 July (Tuesday-Friday) Bharat Tex, New Delhi.

22-24 July (Wednesday-Friday): Rail & Metro Technology Conclave, Bharat Mandapam, New Delhi.

AUGUST

15 August (Saturday): Independence Day.

26 August (Wednesday): Prophet Mohammad’s Birthday.

SEPTEMBER

1-3 September (Tuesday-Thursday): India Energy Week, Dwarka, New Delhi.

8-11 September (Tuesday-Friday): Global Fintech Fest, Mumbai.

7-9 September (Monday-Wednesday): Bengaluru Space Expo, Bangalore International Exhibition Centre, Bengaluru.

7-9 September (Monday-Wednesday): IPHEX, Bharat Mandapam, New Delhi.

17-19 September (Thursday-Saturday): Semicon India Conference, Yashobhoomi, Delhi.

OCTOBER

2 October (Friday): Gandhi Jayanti (Mahatma Gandhi’s Birthday).

20 October (Tuesday): Dussehra.

NOVEMBER

24 November (Tuesday): Guru Nanak Jayanti.

DECEMBER

8-11 December (Tuesday-Thursday), Expand North Star, Dubai.

25 December (Friday): Christmas Day.

Signposted to happen sometime in 2H 2026:

Monsoon Session of Parliament is expected to be held in July/August in New Delhi (TBA);
Reserve Bank of India’s Monetary Policy Committee meeting for the September cycle (TBA);
India Mobile Congress will likely be held in October in New Delhi (TBA).

JANUARY 2027

30 January-3 February (Saturday-Wednesday): Printpack India, India Expo Centre, Greater Noida (Delhi NCR).

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