India Resilient but Oil Shock May Slow Growth: S&P
New Delhi, Apr 14 (BNP): India’s solid macroeconomic and financial sector fundamentals are expected to soften the blow from a sustained rise in global crude oil prices, even though higher energy costs could weigh on overall economic growth, according to S&P Global Ratings.
Pic Credit: Pexel
Under a stress scenario where Brent crude averages around USD 130 per barrel in 2026, India’s GDP growth could be lower by as much as 80 basis points, the rating agency said.
S&P Global Ratings added that corporate profitability would also come under pressure in such a scenario, with earnings before interest, tax, depreciation and amortisation (EBITDA) expected to fall by 15–25 per cent in FY27, while leverage could rise by 0.5–1.0 times.
The agency further cautioned that banking sector asset quality may weaken under prolonged stress, with gross non-performing assets potentially rising to about 3.5 per cent.
