War Crisis: PM Modi Tells Rich Indians to Forget Gold, Cut Fuel, End Foreign Wedding Spree |Gravitas

Added: 2026-05-11

[00:00:09][music] [music] [music] [music] [music] [music] [music] [music] >> As the West Asia crisis threatens energy supplies and pushes import costs higher around the world, Prime Minister Modi delivered a clear message to India's wealthy.

[00:01:12]Avoid buying gold for a year.

[00:01:15]Cut foreign holidays.

[00:01:17]And while making a countrywide appeal to use less fuel, the government believes these measures could help India reduce imports, slow the fall of the rupee, protect foreign exchange reserves, and most importantly, limit the damage if the West Asia conflict deepens further.

[00:01:35]Listen to this.

[00:01:57]The overall message from India is clear.

[00:02:00]The West Asia situation is no longer just a geopolitical crisis far away. It could soon hit the Indian economy, household budgets, consumer prices possibly, and India is taking the steps to safeguard against it.

[00:02:17]A report, in fact, warning that India's current account deficit could widen to around 2% of the GDP.

[00:02:25]In the event of a prolonged West Asia crisis, not just that, the report says a rising import bill could put significant pressure on the economy. The warning also coming as India's external balance is already under stress. The Reserve Bank of India data showing India's foreign exchange reserves fell by 7.7 billion dollars to 690 billion dollars for the week ending May 1. The Central Bank also saying gold reserves declined by 5 billion dollars to 115 billion dollars. Foreign currency assets, the largest component of the reserves, also decreased by 2.7 billion US dollars to 551 billion US dollars, those numbers on your screen.

[00:03:14]In fact, that's why the government has also targeted three major sources of foreign exchange outflow.

[00:03:21]Gold, foreign travel, and oil. Remember, gold remains one of India's biggest economic vulnerabilities in a way.

[00:03:28]Commerce Ministry data showing India's gold import surged to a record 72 billion dollars in financial year 2025 to 2026. That is a 24% jump from 58 billion dollars in the previous year.

[00:03:43]India is estimated to consume between 700 and 800 tons of gold every year. The precious metal accounting for around 9% of India's total import bill.

[00:03:56]Second only to crude oil.

[00:03:58]Industry estimates suggest that even a one-year pause in gold purchases could save between 40 and 50 billion dollars in foreign exchange. That's how significant this is.

[00:04:13]In fact, the Indian government's push also carries risks at the same time.

[00:04:17]Stakeholders in the gems and jewelry industry warning that a sharp fall in gold buying could also trigger a major retail slowdown and impact millions of jobs.

[00:04:28]So, that's the other concern.

[00:04:32]The All India Gem and Jewellery Domestic Council saying the industry employs more than 10 million people directly, including artisans, designers, and sales staff.

[00:04:43]The sector, it claims, also contributes nearly 7% to India's GDP. The government's appeal also extending to foreign travel, especially luxury destination weddings.

[00:04:58]The Ministry of Tourism says more than 32.71 million Indians traveled abroad last year.

[00:05:06]Industry estimates showing more than 5,000 Indian weddings take place abroad every year with total spending close to 50,000 crore rupees.

[00:05:17]And the government aims to keep that money within India, basically, instead of flowing into foreign economies, to put it simply. But oil remains India's biggest contributor to the import bill, remember. India imports nearly 90% of its crude oil requirements, making the economy vulnerable to any global price shock caused by the West Asia crisis.

[00:05:37]The government and energy sector estimates suggest that a 5 to 10% reduction in fuel consumption could save between 10 and 15 billion dollars every year.

[00:05:51]Between 10 and 15 billion dollars every year. And that's why the government is also pushing for work from home, public transport use, and also lower fuel consumption. Opposition parties meanwhile have attacked the government's appeal, calling it an admission of economic failure, and that the burden of a weakening rupee as well as global shocks are now being passed on to ordinary citizens, they say.

[00:06:16]The government insists meanwhile the steps are only precautionary and necessary to protect India's economy during a period of geopolitical uncertainty. Economists also saying India has a relatively safe buffer at this point. Current foreign exchange reserves would basically provide import cover for more than 10 months. Concerns, they say, would grow if that cover falls below the safety threshold of under 4 months.

[00:06:45]Which could also lead to difficulties in handling sudden spikes in oil or gold prices. And as per experts, prices are expected to further rise across India in the immediate future, driven primarily by the spike in global crude and LNG prices due to West Asia tensions, which could also drive up inflation across India from petrol and diesel to food, transport, electricity, daily household goods.

[00:07:11]In a statement, India's government said the country has 60 days of crude oil, 60 days of natural gas, and 45 days of LPG rolling stock.

[00:07:22]Indian government has also said that the country has ample stocks of fertilizers to meet the demand for the upcoming kharif sowing season, and appeal to the farmers not to engage in panic buying.

[00:07:34]And India is not the only country under pressure, of course. For example, 90% of Japan's crude oil imports pass through the Strait of Hormuz. The disruption in supply has also led to a surge in oil prices and caused volatility in the markets.

[00:07:49]And according to the International Monetary Fund, the West Asia conflict is expected to damage the UK economy more than any other G7 nation, leading to higher inflation and lower growth.

[00:08:01]In the US meanwhile, the conflict has resulted in gasoline prices rising by approximately 50% since the start of the war, contributing to rising inflation and complicating the US Federal Reserve's monetary policy.

[00:08:17]So ultimately, the success of India's economic nationalism call, in a way, is likely to depend on the public's response.

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