‘Renewed US-Iran war to impact budgets of millions of Indians’:Expert warns fertiliser price rise may hit Indian farmers deepening agricultural crisis

The restart of the US-Iran war and closure of the Strait of Hormuz may impact household budgets of millions of Indians, with an increase in prices of essential commodities such as cooking oils, packaged foods, dairy products, etc. Already prices of essentials are on the rise in India. By how much have prices increased? The renewed tensions between Israel and Iran are not just a geopolitical concern; they have a direct bearing on the household budgets of millions of Indians. -S.Ravi, former BSE chairman founder, Ravi Rajan and company Ravi adds that India imports more than 85% of its crude oil requirements. He says any disruption in West Asian supply routes or spike in global crude prices quickly translates into higher transportation, logistics, and input costs across the economy. Warning that if crude oil prices remain elevated, he says consumers may witness a 5-10% increase in prices of essential commodities such as edible oils, packaged foods, dairy products, etc. Transportation-dependent goods, including fruits and vegetables, will also become costlier. For an ordinary Indian family, higher inflation means reduced disposable income and a tighter monthly budget -S.Ravi, former BSE chairman founder, Ravi Rajan and company Petrol and diesel also become costlier Prices of petrol and diesel have also gone up. Petrol and diesel prices were risen by a combined ₹7.50 per litre during this war period.
Fertlizer prices on rise globally due to West Asia conflict Additionally, farmers can also feel the hit if fertilizer prices rise. But that is a bit unlikely as government subsidies the agricultural input materials to provide relief to farmers. Global fertilizer prices surge amid West Asia conflict, but Indian farmers remain protected Fertilizer prices across the world have jumped sharply. The main reason is the war in the West Asia. The disruption of shipping through the Strait of Hormuz (a crucial sea route where roughly 25% to 35% of the world’s oil, natural gas, and fertilizers pass). Because natural gas is a major raw material used to make fertilizer, soaring energy prices and trade blockages have made manufacturing and shipping much more expensive. By how much have fertlizer prices increased? According to the World Bank Commodity Markets Outlook Report, the overall global fertilizer prices are expected to rise by 31% in 2026. Urea prices (the most common nitrogen fertilizer) have surged by 40% to 60%, while phosphate fertilizer prices have risen by around 16% to 23%. World Bank Group’s fertilizer price index rose to nearly 4-yr high by April 2026 According to World Bank, on global basis, the World Bank Group’s fertilizer price index by April 2026 had reached its highest level since October 2022, driven mainly by export disruptions related to the closure of the Strait of Hormuz. What is World Bank Group’s fertilizer price index? The World Bank Group’s Fertilizer Price Index represents a single number. The index tracks whether fertilizer prices across the globe are going up or down over time. It is composed of the world’s most common fertilizers. To measure price changes, the World Bank set the index value in the year 2010 to ₹100. If the index moves to 150: Global fertilizer is 50% more expensive than it was in 2010. If the index drops to 90: Global fertilizer is 10% cheaper than it was in 2010. Are fertilizer prices increasing in India? The prices that Indian farmers pay in the market have remained completely unchanged. India imports a large portion of its fertilizer and raw materials. When international prices rose, the Indian government decided to pay the extra cost itself instead of passing it on to farmers. By increasing its government subsidy spending, the government has kept retail prices fixed to protect domestic agriculture and keep food prices stable. According to a PIB release, the government insulated its annadatas from unprecedented global market disruptions. But Professor of Economics, Bharathidasan University, Venkatesh Athreya and Ravi say fertlizer prices can incraese in India as well. With the renewed US- Iran tensions, the inflation rate in India will definitely rise. All energy-related commodities will see sharp increase in prices.Of great concern would be the rise in fertilizer prices which would deepen the crisis in agriculture. – Professor of Economics, Bharathidasan University, Venkatesh Athreya