The West Asia conflict may impact India's remittance flow, as one-third of the inflows from the diaspora come from Gulf Cooperation Council countries, according to Crisil Ratings on Friday.
The current account deficit can be adversely impacted because of a cut in the diaspora's incomes, it said in a note on the West Asia conflict.
"A hit to their incomes can have implications for India's CAD at a time when the trade deficit is already under pressure," the agency said.
India is the world's largest beneficiary of remittances from the diaspora, and received over USD 135 billion of flows in FY25.
The country's export growth is likely to see some drag from disruptions to global trade flows from the West Asia conflict and slower global growth, but lower US tariffs will provide some support.
Under the base case scenario, Crisil also expects a higher import bill due to an 8-9 per cent year-on-year rise in crude price.
Exports to West Asia have been impacted by logistical challenges and supply-chain realignments due to the conflict, though the implications could be mixed, the report said.
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India exported goods worth USD 57 billion to Gulf Cooperation Council (GCC) countries (13 per cent of India's total goods exports) and USD 9 billion (2 per cent) to other West Asian countries, it added.
GCC countries comprise Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE and other West Asian countries such as Iran, Iraq, Israel, Jordan, Lebanon, Syria and Yemen.
For some products, the region holds greater prominence, accounting for over 70 per cent of Basmati rice exports, 30 per cent of boneless bovine meat, 25 per cent of ceramic products, 15 per cent of petroleum products, and 20 per cent of gems and jewellery.
The report said exports to West Asia are getting impacted by logistical challenges and supply-chain realignment.
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
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