The Gulf War’s Impact Grows in Asia
Brownland
The war has not yet directly affected India, but its effects are being felt in every household as it enters its third week, as the Indian press reported today. This impact is coming from multiple directions simultaneously, and this cumulative pressure is making the situation extremely difficult for ordinary citizens.
The most prominent and visible of these effects is the shortage of liquefied petroleum gas (LPG) for cooking. Long queues are forming at distribution points, and restaurants and hotels are considering mandatory closures. The government insists that supplies will last for about a month, but public anxiety is growing nonetheless. Gas prices have already risen in cities, increasing transportation costs and impacting the cost of delivering all goods.
The second wave of impact will come through food supplies. Soaring oil prices and fertilizer supply disruptions are driving up the cost of agricultural production at every stage, from the field to the table. Local experts warn of a prolonged rise in food prices, with low-income households, for whom food is a primary expense, being the most vulnerable.
Furthermore, currency pressures are affecting anyone dealing with imported goods or making foreign payments. Analysts predict the rupee (India’s national currency) will weaken to over 95 rupees per dollar if oil prices remain high, and in a worst-case scenario, to 97.50 rupees or more. Any depreciation of the national currency automatically increases the cost of imports and exacerbates inflation.
The stock markets have already reacted to these developments, with the Nifty 50 and BSE Sensex both falling by about 1.1% in a single session, marking one of their steepest weekly declines in fifteen months. The markets experienced widespread selling, with fifteen out of sixteen major sector indices affected.
Another deeply human story concerns migrant workers. Tens of thousands of Indians who had planned to travel to the Gulf countries found themselves in limbo due to flight cancellations and delays. Between March 1 and 7, 2026, more than 52,000 people returned home. Those who remain working in the region are living under increasing uncertainty. Many oil and gas companies have already suspended operations, according to Indian media.
In general, economists are observing signs of stagflation—high inflation coupled with slowing economic growth. Analysts estimate that every $10 increase in the price of a barrel of oil increases India’s current account deficit by about 0.5% of GDP and reduces corporate profit growth by about 4%.
If the conflict continues for an extended period, particularly if it persists for several months, its impact on the country’s economy will be significant and long-lasting.
Meanwhile, China is restricting fertilizer exports amid supply chain disruptions and rising global prices, Bloomberg reported today.
The agency’s sources stated that the Chinese government has asked exporters to suspend exports of nitrogen and potash fertilizer blends. Beijing has also renewed existing restrictions on urea exports, dashing traders’ hopes for new sales quotas soon.
These measures are intended to protect Chinese farmers as they prepare for spring planting and peak demand. China is the world’s largest consumer and exporter of fertilizers, but any shortage of this essential input could threaten the country’s food security.
With these recent measures, China has effectively halted exports of most types of fertilizers, including compound fertilizers, according to sources.
