India’s resilience to high energy costs has increased significantly over the years, as the country has absorbed severe oil shocks while growth has remained strong, it said.
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Based on its analysis, the industry body said that India has demonstrated its ability to manage high energy prices without compromising its economic growth trajectory.
“Data analysed for the period 2000-01 to 2025-26 shows that India recorded some of its strongest growth years at moderate to high crude oil price levels,” it said.
In 2022-23, growth was 7.6 per cent, even with oil prices (Indian crude basket) at USD 93 per barrel (annual average), whereas in 2023-24, growth remained at 7.2 per cent (new series) with oil prices at USD 82 per barrel, Assocham said.
It further said that despite oil prices above USD 100 per barrel during 2011-14, GDP growth remained at 5.2-6.4 per cent.
During the period under analysis, the sharpest contraction of (-) 5.78 per cent occurred in 2020-21, when prices were among the lowest in the last two decades (under USD 45/bbl), driven entirely by the COVID-19 pandemic.
“India’s growth story is largely driven by its consumption segment, which in turn bolsters the supply side through factory expansion, the deployment of more workers, and higher income levels, creating a virtuous cycle of growth and strengthening the resilience of the economy,” said Nirmal Kumar Minda, President of Assocham.
Assocham believes that India’s GDP growth will remain above 7 per cent in 2026-27, supported by strong consumption, steady exports and growing capital investment, Minda said.
Meanwhile, according to the first advanced estimates of Gross Domestic Product released by the Ministry of Statistics and Programme Implementation (MoSPI) in January, the Indian economy is expected to grow by 7.4 per cent in the current fiscal, maintaining its status as the world’s fastest-growing major economy despite punitive US tariffs and geopolitical tensions.
The economy had grown at 6.5 per cent in the previous fiscal.
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However, Moody’s Ratings earlier this month slashed India’s economic growth estimates for the current fiscal to 6 per cent from 6.8 per cent earlier, saying the ongoing conflict in West Asia will moderate growth momentum and raise inflation risks.
Last month, the Organisation for Economic Cooperation and Development (OECD) projected India’s GDP growth to moderate to 6.1 per cent in the current fiscal from 7.6 per cent growth recorded in 2025-26.
Domestic rating agency Icra expects the growth to moderate to 6.5 per cent in FY27, owing to the adverse impact of elevated energy prices and concerns around energy availability amid the West Asia conflict.