A closure of the Strait of Hormuz, a critical chokepoint handling 20% of global oil, poses severe risks to India, which imports over 88% of its crude oil. Nearly 40-50% of India’s crude and over 50% of its LNG pass through this route, leading to massive disruptions in energy supply, surging inflation, and a widening current account deficit if closed. The Strait is the primary artery for India’s oil imports from Iraq, Saudi Arabia, the UAE, and Kuwait. A shutdown immediately increases shipping costs and insurance premiums, severely limiting supply. While India holds around 100 million barrels of commercial crude oil (roughly 40-45 days of coverage), a prolonged closure would drain these reserves. The situation is particularly critical for LPG, as India imports around 80–85% of its needs, largely from this region. The immediate economic consequence is a sharp increase in global Brent crude prices, potentially exceeding $115 per barrel. This rise dramatically increases India’s import bill, adding pressure on the Indian rupee and accelerating retail inflation, which the Reserve Bank of India (RBI) might have to combat with higher interest rates. Sectors that depend heavily on fuel – such as transportation, manufacturing, paints, and chemicals – would suffer from higher input costs. Furthermore, over 70% of India’s basmati rice exports to West Asia are threatened by shipping delays, impacting agricultural trade. If the closure is sustained, India would have to rely heavily on alternative suppliers, including Russia, the United States, and West Africa. However, these alternatives entail longer shipping times – 25-45 days compared to 5-7 days from the Gulf – translating into higher freight costs. While India has strengthened its resilience through diversification, a complete stoppage of traffic in the Strait of Hormuz, even temporarily, causes significant macroeconomic instability, forcing the government to explore long-term strategies like diversifying energy sourcing, accelerating the renewable energy transition, and promoting alternative fertilisers. In conclusion, one can say that the closure of the Strait of Hormuz is a “low-probability but high-impact” risk that directly threatens India’s energy security, industrial production, and overall economic stability. Given this situation, the government of India has increased non-Hormuz sourcing to approximately 70% and is utilizing the Chabahar Port and the International North-South Transport Corridor (INSTC) to bypass high-risk zones. While Russia offers alternative oil sources, the strategic, economic, and logistical importance of the Gulf remains, making the reopening of Hormuz essential to avoid a major economic slowdown.