Billionaire banker Uday Kotak has issued a stark warning to Indian businesses and households, urging a mindset of “strategic paranoia” as the economic fallout from the escalating US-Iran conflict intensifies. Speaking at the CII Annual Business Summit 2026 on Tuesday, May 12, the founder of Kotak Mahindra Bank cautioned that while the domestic impact has remained relatively muted over the last two months, a significant global shock is fast approaching. Kotak noted that the temporary buffer provided by older oil inventories is reaching its limit, and the transmission of higher energy prices is now inevitable. With crude oil trading near $107 per barrel, he warned that India’s Current Account Deficit could widen from -1% to -2.5% of GDP, placing immense pressure on the rupee and overall financial stability.
The veteran banker described the current global climate as a shift away from cooperative internationalism toward a fragmented “tribal” world order where nations compete fiercely for control over trade routes like the Strait of Hormuz. Highlighting India’s structural vulnerability as an importer of 85% of its oil, Kotak emphasized that households with limited incomes would soon feel the pinch through costlier fuel and rising prices of daily essentials. His remarks align with recent appeals from Prime Minister Narendra Modi for citizens to moderate non-essential consumption and conserve resources during this period of instability. Kotak concluded by calling for a proactive, low-cost structural reshaping of the Indian economy, arguing that companies must focus on long-term resilience and strategic asset control rather than relying on a “comfort zone” that no longer exists in a volatile geopolitical landscape.
