Proactive steps must to limit war's impact: RBI bulletin

India needs to closely monitor the evolving situation in West Asia and take proactive measures to limit the impact of spillovers, as the country is dependent on crude oil imports, the Reserve Bank's bulletin said Monday.

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The March bulletin, however, noted that India's foreign exchange reserves remain adequate to provide a cushion against external shocks, and the creation of an Economic Stabilisation Fund would further provide fiscal headroom and buffer to proactively respond to global headwinds.

An article on the state of the economy published in the March bulletin stated that the conflict in the Middle East and fresh trade investigations by the US have resulted in increased volatility in the global markets, said an article

The renewed conflict in the Middle East and the US investigations into trade practices of key trading partners have brought uncertainties regarding global energy security, US import tariffs and global supply chains back to the centre stage, it said.