New Delhi: Amid the United States-Israel war on Iran in West Asia and its ripple effects on global markets, India’s economy has come under strain. The Indian rupee is in freefall, forex reserves have slumped, equities recorded a steep decline, while oil prices are surging.The rupee fell 20 paise to close at a record low of 92.46 against the US dollar on Friday (March 13), eclipsing its previous all-time low of 92.3575 on Thursday (March 13), amid concerns that the West Asia crisis-induced surge in oil prices could disrupt the country’s growth-inflation dynamics and dent capital flows, according to a Reuters report.Benchmark indices have dropped more than 5% this week, the steepest weekly decline in nearly six years, Mint reported. BSE Sensex dropped 1.93% to end the week at 74,563.92, whereas Nifty 50 fell 2.06% to 23,151.10. This is the sharpest weekly fall since May 10, 2020, when markets were battered by Covid-related uncertainties.A key trigger has been the surge in crude oil prices. Brent crude briefly crossed USD 100 per barrel again intraday on Friday, raising concerns about inflationary pressures. India is also among the most vulnerable markets to a global oil shock as nearly 90% of its crude requirements are imported.Refineries across key oil markets such as Iran, Qatar and the UAE have been hit in the ongoing conflict, forcing the shutdown of large capacities and an unofficial closure of the Strait of Hormuz, a key trade route.Anand K. Rathi, co-founder of Mira Money, was quoted by Mint as saying, “India’s dependence on crude is very high, around 85-90%. If crude prices remain elevated, the country’s deficit could widen further and eventually impact GDP growth as well.”The conflict, and the currency weakness driven by it, has also prompted foreign investors to sell Indian equities worth nearly USD 5 billion so far this month, as per Reuters.Further, forex reserves too slumped to USD 716.81 billion in the week through March 6 from USD 728.49 billion in the previous week, as per Reserve Bank of India (RBI) data, cited by Reuters. The report said that the USD 11.68 billion decline came amid heavy dollar sales by RBI to support the rupee amid geopolitical pressures and surge in oil prices.Meanwhile, Union oil minister Hardeep Singh Puri said in parliament that there is no shortage of liquid petroleum gas despite disruptions due to the war, even as rising concerns over LPG supply have led to long queues outside gas agencies.Given the rush, Delhi Police cancelled routine leaves of its personnel and ordered round-the-clock deployment outside LPG cylinder godowns, shops, warehouses and refilling stations.