India is considering emergency steps to shore up foreign-exchange reserves, including hiking fuel prices and curbing non-essential imports like gold and electronic goods, to help cushion the impact of the Iran war, people familiar with the matter said.
Officials in the Prime Minister’s Office and Finance Ministry have held discussions with the Reserve Bank of India on several measures that could be taken to limit the damage from soaring oil prices, the people said, asking not to be identified as the discussions are private.One of the proposals under discussion is a fuel price hike, which would be the first increase since the Iran war began and come on the back of Prime Minister Narendra Modi’s landslide win in recent state elections. No final decision on the emergency measures have been made yet, the people said.
Gold and consumer electronics are considered non-essential imports and steps could be taken to restrict those items, one of the people said. Officials are concerned about the widening current account deficit and the measures are aimed at curbing imports to preserve foreign exchange, the people said.India’s Finance Ministry and central bank didn’t respond to requests for further information.India is the world’s third-largest oil importer of oil and the country has been hit hard by soaring energy prices and the halting of supplies through the Strait of Hormuz. The outflow of foreign exchange to pay for higher energy bills has pressured the rupee, which has plunged to a record low, and forced the RBI to take aggressive steps this year to stabilize the currency.The rupee fell as much as 0.3% to 95.6313 to a dollar to a record low on Tuesday. The rupee has surrendered all gains made after the RBI announced anti-speculative measures and is Asia’s worst performer so far in 2026 as high oil prices strain India’s import bill.On Sunday, Modi urged citizens to use public transport and work from home to conserve petrol and diesel. He also called on the public to stop buying gold — one of India’s biggest import categories — and restrict overseas travel.“We would be watching for any announcement on a staggered fuel hike and measures to curb gold imports and encouraging capital flows,” said Garima Kapoor, an economist at Elara Securities India Pvt. The prime minister’s “call for conserving forex reserves reflect the reality we are living in.”
