During a speech at Princeton University on April 18, Reserve Bank of India Governor Sanjay Malhotra addressed the supply shock resulting from the ongoing conflict in West Asia, particularly around the Strait of Hormuz. He noted that disruptions in this region have affected energy, fertilizer, and commodity prices, potentially leading to increased imported inflation. The region accounts for about 20% of India's imports, 50% of crude oil imports, and 40% of total fertilizer imports. Malhotra stressed the need for the RBI to remain agile and avoid making firm commitments regarding future monetary policy, focusing instead on data-driven decisions to navigate this uncertain landscape. He highlighted the importance of prudent fiscal management in maintaining price stability, especially as the government has ramped up domestic oil and gas production to mitigate price pressures. The RBI's neutral stance over recent policy cycles allows it to adapt to changing inflation-growth dynamics, leveraging its experience with flexible inflation targeting to manage risks from global events. Malhotra concluded that the core principles of monetary policy remain unchanged, prioritizing robustness in response to uncertainties.