Ongoing Middle East conflict to discourage  investment into India, offset trade...

Key Highlights

• “From March onwards, we expect uncertainty to increase sharply due to the ongoing conflict in the Middle East.
• We believe this will discourage investment in India, offsetting the (EU and US) trade deals’ positive effects on GDP,” BMI said in its India outlook report.
• The US and Israel jointly launched military strikes on Iran on February 28.
• Iran responded by firing drones and missiles at Israel and US military installations around the Gulf, and also at the global business hub of Dubai.
• BMI said that Iran has issued threats to ships traversing the Strait of Hormuz, and a full closure of the Hormuz Strait could directly reduce GDP by up to 0.5 pp through higher energy costs.