India's economy, once thriving with stable inflation and growth, is now grappling with the repercussions of the ongoing Iran war. The conflict has disrupted oil supplies, leading to a 53% spike in India's oil import bill in April 2023 alone. As the world's third-largest oil importer, India's reliance on oil imports makes it particularly vulnerable to fluctuations in global oil prices, which surged to nearly $120 per barrel following the onset of the war. The Reserve Bank of India (RBI) has revised its inflation forecast to an average of 5.1% through March 2027, up from 3.48% in April. Economic growth is also expected to slow to 6.6%, down from 7.7% the previous year. The government is implementing measures to mitigate the impact, including curbing gold imports and encouraging public transport usage. However, these actions may not be enough to prevent a projected balance of payments deficit of $65 billion by 2026-27. With rising inflation and a challenging macroeconomic environment, India's policymakers face tough decisions ahead.