Ashok Gulati, a professor of agriculture at ICRIER, said the Indian economy is on the brink of a major crisis [1].
This warning highlights a growing tension between government spending on agricultural supports and the broader stability of the national economy. If the current trajectory continues, the financial burden of these subsidies could jeopardize India's macroeconomic health.
Speaking in an interview with Karan Thapar for The Wire, Gulati said the intersection of historical shocks and current policy is key. He discussed the impact of the Gulf War on Indian agriculture and how those cumulative effects continue to influence the sector [1].
Gulati said the current approach to agricultural support is unsustainable. To prevent a deeper economic downturn, he said, "We must reduce the fertiliser subsidy" [1].
The professor linked the necessity of these cuts to the long-term stability of the state. He said the combination of the lingering effects from the Gulf War and the ongoing cost of subsidies creates a precarious situation for the country's finances [1].
Throughout the discussion, Gulati said the economy seems to be on the brink of a major crisis [1]. He positioned the reduction of the fertiliser subsidy as a critical step toward mitigating these risks.
“The economy seems to be on the brink of a major crisis”
The call to reduce fertiliser subsidies represents a significant policy shift that could alienate the farming community, a powerful political constituency in India. By linking current economic instability to the historical impact of the Gulf War, Gulati is arguing that the structural vulnerabilities of Indian agriculture require urgent fiscal correction to avoid a systemic financial collapse.
