PolicyRadar Weekly Briefing

India's energy crisis escalated sharply this week as Iran struck Qatar's massive gas fields, premium petrol prices were hiked by Rs 2 per litre, and the rupee crashed past 93 per dollar to a record low. The Indian Navy deployed warships to escort tankers through the Strait of Hormuz, while the government barred households with piped gas from holding LPG connections and pushed states to accelerate the shift to PNG. On the domestic front, the Election Commission announced assembly polls in West Bengal, Assam, Tamil Nadu, Kerala, and Puducherry for April 9, reshuffling the political calendar. Parliament cleared Rs 53 lakh crore in Demands for Grants, the Cabinet approved a Rs 33,660 crore scheme to build 100 industrial parks, and the week ended with the US easing sanctions on Iranian oil at sea — offering the first glimmer of supply relief in weeks.

The West Asia conflict widened when Iran struck gas fields in Qatar, sending Brent crude above $110 and European gas prices spiking 35%. India's LPG consumption slumped 17% in March as supply shortages hit harder. The government responded on multiple fronts: the Indian Navy began escorting oil tankers through the Strait of Hormuz, oil companies hiked premium petrol by Rs 2 per litre and industrial diesel by Rs 22, and the Centre barred households with piped natural gas from holding LPG connections or refills. By week's end, the US eased sanctions on some Iranian oil at sea, and India began talks with Canada and the US for alternative LPG supplies.

Currency & Markets

The rupee breached 93 per dollar for the first time, with Goldman Sachs warning it could slide to 95. Foreign portfolio investors dumped over Rs 52,700 crore in the first half of March. The stock market posted its worst weekly fall in nearly four years, wiping out Rs 20 lakh crore in investor wealth. PhonePe paused its IPO as primary market sentiment deteriorated.

Consumers & Households

The government's decision to bar PNG users from LPG refills affects 60 lakh households. IndianOil's LPG booking app overtook ChatGPT as the top download on Google Play. Tamil Nadu's CM announced a Rs 2 per unit power subsidy for eateries switching to induction stoves. Mid-day meal kitchens at schools reverted to firewood, burdening women workers.

Industry & Trade

Airlines imposed fuel surcharges of Rs 425 to Rs 2,300 per ticket, with IndiGo, Air India, and Akasa all hiking fares. Thousands of restaurants remain shut. Steel companies cut output on gas supply woes. HCLTech asked employees to work from home amid LPG shortages in Chennai. The government launched a Rs 497 crore RELIEF scheme offering insurance and deadline extensions for exporters hit by the disruption.

Food & Agriculture

Yara International's CEO warned that a prolonged Iran conflict could severely disrupt global food supplies. India fast-tracked fertiliser imports and opened talks with Russia, Belarus, and Morocco for supply. The government assured kharif fertiliser stocks are adequate, but the parliamentary committee flagged that realistic subsidy funds need to be allocated at the budget estimate stage itself.

Foreign Policy & Diplomacy

India walked a tightrope between Iran and the US. The MEA clarified India has not held bilateral talks with the US on deploying warships to Hormuz, while Jaishankar confirmed there is no blanket arrangement with Iran for safe passage. Six Indians have died in the conflict and one remains missing. Over 2.44 lakh passengers have been repatriated from West Asia since February 28.

The US easing sanctions on Iranian oil at sea is the week's most significant de-escalation signal — Indian refiners are set to buy Iranian crude once the government gives approval. Watch whether this translates into actual supply relief or remains symbolic. The RBI's next moves on the rupee are critical, with forex reserves falling $7 billion in a single week to $709.76 billion. And the IMF has warned that the conflict could push up global inflation by 60 basis points and cut growth by up to 0.4 percentage points.

What started as a gas supply problem three weeks ago is now a full-spectrum economic shock — hitting the rupee, markets, airlines, food supply, and industry simultaneously. The US sanctions waiver offers a narrow off-ramp, but India's structural energy vulnerability is now impossible to ignore.

1. Assembly Elections Announced for Five States

The Election Commission set April 9 as polling day for West Bengal, Assam, Tamil Nadu, Kerala, and Puducherry, with results on May 4. The BJP released its first candidate list of 144 for Bengal — fielding Suvendu Adhikari against Mamata Banerjee in Bhabanipur — and 88 for Assam, including freshly defected Congress MP Pradyut Bordoloi. The Model Code of Conduct is now in effect. [Politics]

2. Lok Sabha Clears Rs 53 Lakh Crore in Demands for Grants

Parliament approved Demands for Grants and the Appropriation Bill for 2026-27, along with an additional Rs 2.01 lakh crore in supplementary spending for FY26. Finance Minister Sitharaman announced a Rs 57,381 crore Economic Stabilisation Fund to create a fiscal buffer against global shocks. Net direct tax collections reached Rs 22.8 lakh crore, up 7.2% year-on-year. [Finance]

3. Cabinet Approves Rs 33,660 Crore BHAVYA Industrial Parks Scheme

The Cabinet cleared the BHAVYA scheme to develop 100 plug-and-play industrial parks, alongside a Rs 2,584 crore small hydro power push and a Rs 6,969 crore four-lane highway in UP. Separately, SEBI eased public shareholding norms for mega IPOs — paving the way for Jio, which has reportedly hired 17 investment banks and may file its draft IPO papers by early April. [Infrastructure]

4. NIA Arrests US Mercenary and Six Ukrainians for Anti-India Links

The NIA arrested American citizen Matthew VanDyke and six Ukrainian nationals for allegedly training Myanmar rebels linked to anti-India insurgent groups. Ukraine called the arrests "possibly orchestrated" and expressed serious concern, while the US said it was aware of the situation. The case adds a new dimension to India's security posture in the northeast. [Defence]

5. HDFC Bank Chairman Abruptly Resigns, Citing Ethics Concerns

HDFC Bank chairman Atanu Chakraborty resigned suddenly, citing unspecified ethics concerns, wiping Rs 1 lakh crore off the bank's market cap in a single session. The bank subsequently fired three senior executives for mis-selling Credit Suisse AT1 bonds. The RBI stepped in to reassure markets, calling HDFC Bank a strong institution with strong fundamentals. Keki Mistry has returned as interim chairman. [Finance]

93.80 — The rupee's record low against the US dollar this week

17% — Drop in India's LPG consumption in March due to war-related shortages

Rs 53 lakh crore — Demands for Grants approved by Lok Sabha for FY27

Rs 52,700 crore — FPI outflows in the first half of March alone

2.44 lakh — Passengers repatriated from West Asia since February 28

Rs 33,660 crore — Outlay for the BHAVYA plug-and-play industrial parks scheme

With five state elections announced for April 9, the political machinery kicked into overdrive. The BJP released early candidate lists for Bengal (144 seats) and Assam (88 seats), while Congress suffered a blow when senior Assam MP Pradyut Bordoloi defected to the BJP days before polls. In the Rajya Sabha elections, NDA swept Bihar and Odisha amid cross-voting drama — Congress expelled three Odisha MLAs and saw five Haryana MLAs cross party lines. Kerala saw BJP field Rajeev Chandrasekhar and V Muraleedharan in key seats, while in Tamil Nadu, Sasikala launched a new party and AIADMK's Palaniswami ruled out any alliance with Vijay's TVK. The election season will dominate the next six weeks of Indian politics.

US sanctions waiver on Iranian oil — Indian refiners are ready to buy. Government approval is the missing piece. If it comes, this could mark the first real easing of India's energy crunch.

New Income Tax Act kicks in April 1 — The government notified the new Income Tax Rules 2026 this week. Enhanced HRA benefits, stricter compliance requirements, and a nationwide awareness campaign called PRARAMBH 2026 are all live from next week.

RBI's currency defence — Forex reserves fell $7 billion in a single week. With the rupee past 93 and Goldman warning of 95, the central bank's next intervention signals will be closely watched.

WTO Ministerial (MC14) approaching — India is set to oppose a US proposal seeking a permanent ban on e-commerce customs duties. Trade officials say India will play a constructive role but hold firm on food stockholding and other key issues.