·The Hindu·15 marks·250–350 wordsEconomy

"India's growth resilience amid geopolitical energy shocks calls for structural energy security reforms." Elaborate with policy measures.

In this answer
  1. Evidence of resilience
  2. Why energy shocks still expose the economy
  3. Policy measures required

India's real GDP grew 7.8% in Q1 FY27 (April–June 2026), with real GVA at 8.2%, even as West Asian conflict kept energy prices elevated [1]. The resilience is genuine, but it rests on imported energy — making structural reform urgent rather than optional.

Evidence of resilience

  • Growth was broad-based: manufacturing 9.2%, services 10%, construction 7.7%, with finance and professional services at 12.1% [1].
  • It was investment-led: gross fixed capital formation grew 11.9%, and real exports 12% despite uncertain trade conditions [1].
  • Nominal GDP reached ₹88.27 lakh crore, growing 10.3% — indicating price pressures were absorbed, not passed on unchecked [1].

Why energy shocks still expose the economy

  • Mining contracted 2.4% and agriculture grew only 3.6% [1] — a weak primary sector narrows the domestic energy cushion.
  • Buffer stocks are thin: strategic reserves of 5.33 MMT at Visakhapatnam, Mangaluru and Padur cover roughly 9.5 days of crude requirement, with total national storage near 74 days [2].
  • Growth is not self-sustaining: exports are concentrated in less labour-intensive goods and services, and private capital spending is expected to grow more slowly amid global uncertainty [3]. Household consumption, at 7.1%, was the weakest demand engine [1].

Policy measures required

  • Diversify supply: extend LNG sourcing beyond traditional suppliers (Australia, USA, UAE) and lock in long-term contracts against price volatility [2].
  • Deepen storage: complete Phase-II strategic reserves of 6.5 MMT at Chandikhol and Padur on PPP mode [2].
  • Substitute the fuel itself: scale the National Green Hydrogen Mission (₹17,490 crore incentives to 2029-30; 5 MMT annual capacity targeted by 2030) alongside renewables and demand-side efficiency [4].
  • Widen the base: revive domestic exploration and raise energy productivity per unit of output.

One strong quarter proves absorptive capacity, not immunity. Converting today's investment momentum into diversified sourcing, deeper reserves and green fuels would turn episodic resilience into durable energy security — aligning growth with SDG-7's affordable and clean energy commitment.

Sources

  1. 1MoSPI Press Note on GDP Estimates for Q1 2026-27Q1 FY27 GDP/GVA growth, sectoral and demand-side figures
  2. 2PIB, "Government steps to Strengthen Strategic Petroleum Reserves", Ministry of Petroleum & Natural GasSPR capacity and days of cover, Phase-II facilities, LNG diversification and long-term contracts
  3. 3World Bank, India Development Update, April 2026export concentration in less labour-intensive segments; expected slowdown in private capex
  4. 4National Green Hydrogen Mission, Ministry of New and Renewable Energymission outlay and 2030 green hydrogen capacity target
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