Why PM Modi Wants India to Prepare for an Energy Shock

Prime Minister Narendra Modi on May 10 asked citizens to revive work-from-home practices and avoid non-essential foreign travel for at least a year, expressing concerns over the growing economic impact of the ongoing West Asia conflict on global energy supplies, fuel prices and supply chains.

While speaking at an event in Secunderabad after inaugurating and laying the foundation stone for projects worth nearly ₹9,400 crore in Telangana, PM Modi said that India needs to collectively prepare to deal with the economic fallout of the crisis by reducing dependence on imported fuel and saving foreign exchange.

He said the country’s response to the changing global situation should go beyond government action and require public participation through changes in everyday consumption and travel behaviour.

“In this time of global crisis, we have to make a resolution keeping duty paramount and fulfil it with complete dedication,” reported PTI citing the Prime Minister. “A big resolution is to use petrol and diesel sparingly. We must curb our use of petrol and diesel,” he added.

India’s Oil Import Dependence

According to a report published by the Institute for Energy Economics and Financial Analysis in April 2026, India currently imports nearly 85% of its crude oil requirements, and prior to the US-Iran war, 45% of those imports transited the Strait of Hormuz. When that chokepoint closed, India’s import bill was immediately affected.

Any rise in oil prices directly affects fuel prices, inflation, fertiliser costs, transport costs, rupee stability, foreign exchange reserves.

The IEEFA report further stated that a swift, multi-pronged government response helped cushion the worst immediate effects, but it also exposed how much further India needs to go. The West Asia crisis made clear that energy transition in transport is not just an environmental goal but a national security imperative.

Why West Asia Matters

A major share of India’s oil comes from West Asia. The Strait of Hormuz is critical for global oil shipments. Any geopolitical disruption in the region affects global crude supply and prices.

Even expectations of supply disruption can push oil prices upward.

Moreover, India’s energy demand traditionally surges between April and June due to the power consumption driven by air conditioners, irrigation and industrial cooling against the intense heatwaves and rapid economic growth. Peak electricity demand has climbed from 190 GW in January 2021 to nearly 250 GW in May 2024.

The rise in demand is in line with the progression of summer conditions across the country, with electricity consumption witnessing a significant growth of 8.9% during the month of April 2026 (01st to 27th Apr) over the corresponding period last year, stated Ministry of Power in its news release published in April 2026.

Why Modi Mentioned WFH

PM Narendra Modi suggested reduced commuting lowers petrol and diesel consumption.

Recalling the Covid era, he underscored that remote work had become normal during the period. The government sees behavioural changes as short-term demand management tools.

He asserted, “We must make efforts to use only as much as is needed to save foreign currency and reduce the adverse effects of war crises.”

"We have to save foreign exchange by any means," he said, adding that due to the West Asia conflict, prices of petrol and fertilisers had increased significantly.

Stressing the need to save foreign exchange due to the crisis, Modi called for postponing the purchase of gold and foreign travel for one year.

He further urged people to use metro rail services in cities, encouraged carpooling, increased use of electric vehicles (EVs), utilising railway services for parcel movement and working from home for a year, stressing the need to save foreign exchange due to the crisis in West Asia.

India’s Energy Independence Push

A report published by Lawrence Berkeley National Laboratory, a federally funded research and development centre, along with The India Energy and Climate Centre (IECC) located at UC Berkeley’s Goldman School of Public Policy, stated that India can achieve energy independence through clean technology by 2047. The report stated that recent dramatic declines in clean energy costs provide India an opportunity to lower energy imports through investment in renewable energy, battery storage, EVs and green hydrogen.

Prime Minister Narendra Modi has already set a target to install 500 GW of renewable energy capacity by 2030. The government intends to amplify EV sales in India to capture the markets of 30% of private cars, 70% of commercial vehicles and 80% of two- and three-wheelers by 2030. Also, it is targeting production of 5mn tonnes of green hydrogen by splitting water using electricity from renewable sources.