India Can Grow Above 7% Annually Even If Crude Costs $90-100 per Barrel: Assocham

Wednesday, April 22, 2026

India’s economy is projected to grow at over 7 percent annually in 2026-27 despite crude oil prices ranging from $90 to $100 per barrel, driven by strong domestic consumption, exports, and investment. This resilience to high energy costs highlights India’s robust growth model, supported by rising incomes and government infrastructure spending, which helps buffer the economy against external shocks.

India’s economy is expected to maintain an annual growth rate exceeding 7 percent in the fiscal year 2026-27, even if crude oil prices range between $90 and $100 per barrel, according to an analysis by industry chamber Assocham. The outlook is supported by strong domestic consumption, steady export performance, and rising capital investment.

The study highlights India’s increasing resilience to high energy costs over the past two decades. Despite episodes of elevated crude oil prices, the country has managed to sustain robust economic growth. Between 2000-01 and 2025-26, India recorded some of its strongest growth years during periods of moderate to high crude prices. For example, in 2022-23, the economy expanded by 7.6 percent even as the average price of Indian crude stood at $93 per barrel. The following year, 2023-24, growth was projected at 7.2 percent with oil prices averaging $82 per barrel.

Historical data examined by Assocham also shows that during 2011-14, when global crude prices exceeded $100 per barrel, India’s GDP growth remained within a 5.2 to 6.4 percent range. This contrasts with the sharp contraction of 5.78 percent in 2020-21, which coincided with the COVID-19 pandemic and occurred during a period when oil prices were among the lowest in recent decades, falling below $45 per barrel.

According to Assocham president Nirmal Kumar Minda, the country’s consumption-driven growth model has played a pivotal role in strengthening economic resilience. Rising income levels, factory expansions, and increased employment have created a virtuous cycle that supports both supply and demand dynamics. Government infrastructure spending has also been noted as a key factor mitigating the adverse effects of external shocks such as fluctuations in crude oil prices.

Overall, the findings suggest that while higher oil prices typically pose challenges for oil-importing economies, India’s expanding internal demand and diversified economic structure have enabled it to absorb such shocks without significantly derailing its growth trajectory. The ability to maintain strong GDP growth amid varying crude price environments underscores the evolving robustness of the Indian economy.