New Delhi: Finance Minister Nirmala Sitharaman has said the recent rise in international crude oil prices is not expected to have a major impact on India’s inflation, as the country’s current inflation levels remain relatively low.
In a written reply to a question in the Lok Sabha, she noted that global crude prices had been declining until before a war began in West Asia on February 28. The price of a barrel of crude, which was around $69 then, rose to $80.16 by March 2.
She pointed to retail inflation easing from 5.40% in 2023-24 to 4.60% in 2024-25, and further down to about 1.80% during April–January of 2025-26. Wholesale inflation in January was recorded at 2.75%, within the Reserve Bank of India’s target range of 2% to 6%.
Sitharaman said the RBI’s Monetary Policy Committee has reduced interest rates by nearly 1.25 percentage points since February 2025 to help manage inflation. She also listed government measures such as boosting essential stocks, selling procured grains in the open market, encouraging imports while curbing exports, subsidised “Bharat Brand” food sales, and cuts in fuel taxes.
She added that raising the personal income tax exemption limit to Rs 12 lakh (and Rs 12.75 lakh for salaried taxpayers) has increased disposable income, while GST rate rationalisation has supported lower inflation. Separately, she said penalties for not maintaining minimum balance have been waived for customers of about 72 crore basic bank accounts, including Jan Dhan accounts.
