India's economic growth is projected to slow to 6.7% in the fiscal year 2026-27, down from 7.7% in the previous year, according to BMI, a Fitch Group firm. The slowdown is attributed to waning economic momentum and a significant oil price shock stemming from the ongoing conflict in Iran. The price of Brent Crude has surged to $105 per barrel, up from $73 before the war began on February 28, leading to concerns about inflation and consumption growth. BMI highlighted that the conflict has already curtailed supply chains, impacting energy and food availability, which could further slow consumption and raise inflation rates. Additionally, the Indian weather department forecasts 'below normal' rainfall due to El Niño, which could negatively impact agricultural output and GDP by an estimated 0.1%. Despite a strong start to 2026, with GDP growth of 8% in the January-March quarter, the effects of tax reforms implemented in 2025 are expected to wane, leading to a reduction in economic momentum. Analysts emphasize that India's economy is particularly sensitive to fluctuations in energy prices, making the current geopolitical situation a critical concern for future growth.