Seventy-three days into the Iran war, the Prime Minister asked Indians to cut fuel, defer foreign travel, postpone gold, reduce edible oil, revive work-from-home, and buy Indian. Citizens of any country with an import profile like India's would accept restraint in a crisis. The question is why this crisis arrived so unprepared for, after eleven years of Make in India, Atmanirbhar Bharat, and Aatmanirbharta. Each ask names a vulnerability the policy ledger was supposed to close. The bill is being presented to households because the ledger is not.

The Prime Minister stood at a public meeting in Hyderabad on May 10 and named six things Indians should give up: petrol and diesel, foreign trips, gold purchases, edible oil consumption, foreign-made goods, and office attendance, the last to be replaced by work from home and virtual meetings revived from the COVID years. The next day in Vadodara, the appeal was repeated, with the explicit framing that India would overcome the West Asia crisis, as it had COVID. Each item was named in the national interest. Each item names a vulnerability that the policies of the last eleven years were supposed to close.

In March, when the joint US-Israeli bombing of Iran shut the Strait of Hormuz and pushed Brent crude past $108 a barrel, I wrote that the war's costs were arriving at the doorsteps of countries that had not started it. The piece described families in Delhi paying ₹2,500 to ₹3,000 for black-market LPG cylinders that officially cost ₹913. That was day nineteen of the war. We are now at day seventy-three. The Strait remains effectively closed to commercial shipping. Brent has crossed $126. India's foreign exchange reserves have fallen by roughly $37.8 billion since their February peak of $728.49 billion. The rupee trades at 94.28 to the dollar, its weakest level on record.

This essay is about what those six asks mean when read against the policy record they sit on. The asks themselves are not unreasonable. A government facing the largest oil supply shock since 1990, a record-low rupee, and a shrinking foreign exchange buffer is entitled to ask citizens for restraint. What is at issue is why the asks had to be made at all. Each one names a vulnerability that eleven years of self-reliance branding, a ₹1.97 lakh crore production-linked incentive programme, two national missions on edible oils, a strategic petroleum reserve programme, and a comprehensive trade agreement with the Gulf were meant to close. The vulnerabilities have not been closed. Several have widened. The development economics framing is not optional. Each ask names a planning failure with a paper trail. The arithmetic deserves to be read item by item.

The arithmetic the appeal does not show

The political logic of the appeal hangs on a single number: the foreign exchange reserve. The implicit promise is that household restraint will protect the country's dollar buffer. The Informal Group of Ministers, chaired by Defence Minister Rajnath Singh, has reported 60 days of crude oil stock, 60 days of natural gas, 45 days of LPG, and $703 billion in foreign exchange reserves. That last figure is the one the appeal rests on.

Think of the reserve position the way a household thinks about its bank balance. A balance of ₹10 lakh looks healthy until you learn that ₹4 lakh of it is borrowed, ₹2 lakh is already committed to bills due next month, and the salary credits that built it have stopped arriving. India's reserve position has a version of all three problems.

Start with what is going out. India's current account deficit, the gap between what the country pays out for imports and earns from exports plus services, widened to $13.2 billion in the October-December 2025 quarter from $11.3 billion in the same quarter a year earlier. The merchandise trade deficit climbed to $93.6 billion from $79.3 billion. That widening reflected a forced switch by Indian refiners away from discounted Russian crude under US pressure. India had been buying Russian crude at $10 to $13 a barrel below Brent for three years; once the Strait of Hormuz closed in February, the same crude returned at premiums of $2 to $8 above Brent. The same barrels now cost more.

Consider what was coming in. Foreign capital reaches India through two principal windows: foreign direct investment, which buys long-term stakes in Indian companies, and foreign portfolio investment, which buys Indian stocks and bonds. Both have narrowed sharply. The Reserve Bank's State of the Economy report in May 2025 recorded that net foreign direct investment collapsed to $0.4 billion in 2024-25 from $10.1 billion in 2023-24, a 96 per cent fall. The Reserve Bank framed it as a sign of market maturity, but the underlying mechanics tell a different story: foreign investors took out $51.5 billion in repatriated profits and disinvestments while Indian companies sent $29.2 billion abroad as their own outward FDI. Net foreign portfolio investment fell from $44.1 billion in 2023-24 to $3.6 billion in 2024-25. The income side of the external account has thinned, while the expense side has expanded.

The borrowed and committed components are the third piece. India's external debt rose to $736.3 billion as of March 2025, up by $67.5 billion in a single year. Separately, the RBI's outstanding net forward sales of dollars, the position the central bank has built up by promising to deliver dollars at a future date to defend the rupee today, rose to $84.3 billion at the end of March 2025. A substantial slice of the headline reserve number is already committed to settling those forward positions.

A reserve cushion built on falling FDI, falling FPI, rising external debt, and rising forward commitments is not the cushion the headline number suggests. The appeal asks citizens to reduce consumption to protect a buffer that the government has spent eleven years drawing down through duty cuts, threshold liberalisations, and the absence of the production base that would have generated dollar inflows in the first place. This is not a crisis the country was unprepared for because preparation was impossible. It is a crisis the country is unprepared for because the preparation was not done.

This is the context in which to read each of the six asks.

Petrol, diesel, and the cavern that was not dug

The first ask is a restraint on petrol and diesel. The framing invokes citizens as fuel conservationists. The policy record is different.

India imports between 85 and 89 per cent of its crude oil, depending on the year. The share has risen across the Modi years, not fallen. The Council on Foreign Relations notes that India's import dependence stood at 87 per cent in 2024 and is projected by the IEA to rise to 92 per cent by 2035. Domestic crude production has fallen by roughly 26 per cent over the past decade, and by another 2.5 per cent in 2024-25. The Standing Committee on Petroleum and Natural Gas observed in its December 2023 report that the crude oil import bill amounts to 25 per cent of all merchandise imports.

The first structural answer to that dependence is strategic storage. Think of the strategic petroleum reserve as the country's pantry: a stock of crude oil set aside so that when supply is disrupted, refineries can keep operating. India's pantry, managed by the public sector ISPRL, holds 5.33 million metric tonnes of crude across three locations at Mangaluru, Visakhapatnam, and Padur. At current consumption rates, the pantry holds 9.5 days of national crude requirement. Add the working stocks held at oil marketing company tanks, and the total cover is about 74 days of crude and petroleum products. The International Energy Agency, of which India is an associate member, recommends 90 days of net import cover as the minimum for an energy-importing economy. The United States holds over six months of cover. China has built reserves estimated at over 90 days. India has not met the 90-day standard in any year of the Modi government.

Phase II of the SPR programme, which would add caverns at Chandikhol in Odisha and a second facility at Padur, received in-principle approval in June 2018. It is being constructed now, eight years later, under leasing arrangements with private and foreign refiners. An industry source told Business Standard in October 2024 that building the 2.5-million-tonne Padur facility would take six years from contract award. The expanded pantry that would have absorbed the 2020 oil price collapse, when the Indian basket briefly fell below $20, was approved two years before that collapse and remains unbuilt today. The government did fill the existing 5.33 MMT facility during the 2020 dip, with notional savings of about ₹5,000 crore. That fill is a fraction of what the system should have been able to absorb.

The fiscal logic of these excise increases is documented in PRS Legislative Research's analysis of petroleum taxation. Between November 2014 and January 2016, the Centre raised excise duty on petrol and diesel nine times during the price collapse, taking excise revenue from ₹99,000 crore to ₹2.42 lakh crore. The same playbook was used when crude crashed below $20 in April 2020: in May 2020, the government imposed record single-day hikes of ₹10 per litre on petrol and ₹13 per litre on diesel, pushing total petroleum excise revenue from ₹2.38 lakh crore in 2019-20 to ₹3.84 lakh crore in 2020-21, a 67 per cent year-on-year jump.

Gurdeep Sappal's reconstruction in National Herald puts total petroleum tax collections between 2014-15 and 2025-26 at roughly ₹67 lakh crore including the states' share, with the Union government's share at about ₹44 lakh crore, against ₹10.75 lakh crore collected by the UPA across its full decade. The UPA decade returned roughly 80 per cent of petroleum tax receipts to the public as fuel subsidy under the Administered Price Mechanism. The Modi years have returned approximately 4 per cent.

The fiscal question is what that revenue funded. ONGC, India's domestic upstream company, carried a ₹13,000 crore cash surplus in 2014 and had zero debt. By March 2024, ONGC's long-term debt on a standalone basis stood at approximately ₹78,000 crore, after being forced in August 2017 to acquire Gujarat State Petroleum Corporation's 80 per cent stake in a Krishna-Godavari gas block for ₹7,738 crore, and in January 2018 to acquire the central government's 51.11 per cent stake in Hindustan Petroleum Corporation Limited for ₹36,915 crore at a price 14 per cent above the prevailing market rate to help the Centre meet its disinvestment target.

The HPCL acquisition was financed largely through ₹35,000 crore in short-term loans from public- and private-sector banks. The upstream company that should have funded the exploration and reserve buildup to insulate the country from the present moment was instead used as an instrument to clean up the Centre's books and meet its fiscal deficit targets. ONGC's capital expenditure profile narrowed accordingly. The IEA now projects domestic production at 540,000 barrels per day by 2030, while projected consumption requires imports of over 6 million barrels per day. The country importing 88 per cent of its oil today is on track to import 92 per cent within a decade.

The third structural answer is the substitution programme. Ethanol blending replaces a percentage of petrol with alcohol distilled from sugarcane or grains. The argument is that for every litre blended, the country imports one litre less of crude. Blending rose from 1.53 per cent in 2014 to 20 per cent by November 2025, with E20 fuel becoming mandatory across India from April 1, 2026. The headline is a clean achievement. The substitution arithmetic is more complicated.

The catch is what the ethanol is being made from. In January 2024, the government raised the procurement price for corn-based ethanol to shift the feedstock mix away from sugarcane, which the country also exports and uses for sugar. The result, as Lydia Powell observed in an ORF analysis, was that India became a net importer of corn in 2024 for the first time in decades. The corn now being imported is replacing the crude that was being saved by blending. The trade-off is more direct than that: corn used for ethanol is corn not available for feed, and feed shortage shows up as higher poultry and dairy prices.

The Arcus Policy Research assessment of the E20 raw material balance, published in The India Forum, found that meeting the blending target diverts substantial quantities of rice, maize, and sugarcane from food and feed uses. The country with the largest population of stunted children is diverting cereals into petrol tanks to reduce crude oil import dependence, which has risen anyway. Powell's term for it is the right one: a self-goal.

The fuel ask, read against this record, is not unreasonable in itself. Citizens of a country importing 88 per cent of its oil should drive less when the Strait of Hormuz is closed. The unreasonable part is the position the planning record left them in. The strategic reserve was not expanded. The upstream company was hollowed out. The substitution programme produced a new import bill in place of the old one. The tax windfalls from three separate cheap-oil windows were used to finance the deficit rather than to buy reserves, fund exploration, or build the public transport that would have insulated households at this moment. The fuel ask is the receipt for those choices, presented to the citizen.

The edible oil mission that did not arrive

The second ask is to reduce edible oil consumption. The framing is dietary moderation. The policy record is the National Mission on Edible Oils.

India is the world's largest importer of vegetable oils and meets roughly 56 per cent of its edible oil demand through imports, down marginally from 63.2 per cent in 2015-16. The country imports about 9 million tonnes of palm oil annually, valued at over ₹40,000 crore, most of it from Indonesia and Malaysia. Soybean oil, sunflower oil, and palm oil together account for the bulk of the bill.

The Modi government's flagship response is the National Mission on Edible Oils, Oil Palm (NMEO-OP), approved in August 2021 with an outlay of ₹11,040 crore. The mission targeted bringing 6.5 lakh hectares under additional oil palm cultivation by 2025-26, reaching a total of 10 lakh hectares, and lifting domestic Crude Palm Oil (CPO) production to 11.20 lakh tonnes by 2025-26 and 28 lakh tonnes by 2029-30. The companion NMEO-Oilseeds, approved in 2024, targets 25.45 million tonnes of domestic edible oil production by 2030-31, meeting around 72 per cent of projected domestic requirement.

The progress against these targets is documented in the government's own returns. Total oil palm coverage stood at 6.20 lakh hectares as of November 2025, against the 10 lakh hectare goal. CPO production stood at 3.80 lakh tonnes in 2024-25, against the 11.20 lakh tonne target for 2025-26. The Drishti IAS reading of the mission documents notes that ICAR's 2020 evaluation identified 27.99 lakh hectares of potential oil palm area across 22 states, of which less than 20 per cent has been brought under cultivation in five years of mission operation. The 432 oilseed varieties released between 2014 and 2025 have not closed the gap because the gap is structural: smallholder yields, dispersed acreage, post-harvest losses, and the long gestation period of oil palm, which takes four to seven years from planting to commercial yield.

The asks made of households today are the inverse of the asks the mission was meant to fulfil. The mission was meant to replace imports with domestic production so that households would not need to ration. The shortfall in domestic substitution now reaches households as a request to ration. The substitution was always going to take time. The mission was approved late in the Modi government's tenure, after seven years of palm oil import dependence had already accumulated. The 2030-31 self-sufficiency target of 72 per cent, the formally stated goal, accepts continued dependence of 28 per cent on imports as the success scenario. The 2026 crisis is being absorbed before the success scenario has matured. Households are being asked to bridge a gap the policy never promised to close on this timeline.

There is a second axis here. The rural employment guarantee, which is the principal welfare floor for the same households being asked to consume less, has been hollowed out at the same time. The MGNREGA allocation, which stood at ₹86,000 crore in the 2025-26 Budget, has been cut to ₹30,000 crore in the 2026-27 Budget, a 65 per cent reduction in a single year. The replacement programme, Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (Gramin), or VB-G RAM G, has been allocated ₹95,692 crore, but the design transfers a substantial share of the financing burden to state governments and replaces the demand-driven entitlement structure of MGNREGA with a target-based programme. As I have argued in the structural transformation piece, the practical effect is to remove the wage-employment floor at the moment when reverse migration has put more pressure on it. The same households being asked to consume less edible oil are the households for whom the rural welfare floor was meant to underwrite consumption itself. The squeeze is being applied at both ends.

The edible oil ask is reasonable in isolation. It is unreasonable in context because the policy framework that should have produced edible oil sovereignty was approved seven years late, designed for a 28 per cent permanent shortfall, and is running even behind that diminished target.

The gold ask, after the duty was cut

The third ask is to defer gold purchases for one year. Gold imports are described as a drain on foreign exchange. The framing is correct on the arithmetic. India's gold imports surged to a record $72 billion in 2025-26, up 24 per cent from $58 billion in 2024-25, accounting for roughly 9 per cent of total imports. India meets about 85 per cent of its gold requirement through imports. The framing is wrong on the cause.

The single largest policy intervention on gold imports in the Modi years was made in the July 2024 Union Budget. Customs duty on gold was reduced from 15 per cent to 6 per cent. A nine-percentage-point cut on an item that accounts for one in eleven of the dollars India spends on imports is a substantial fiscal signal, and gold importers read it as intended. The volume of gold imports in 2025-26 actually fell by 4.76 per cent year-on-year, because global gold prices were rising sharply; the value surge despite a small volume drop tells you how quickly the duty cut was monetised by importers moving to bring gold in.

Consider what this looks like in plain terms. A finance ministry running a chronic current account deficit, in which gold is the second-largest import after crude, cut the duty on gold by 9 percentage points in one budget. It then maintained a trade agreement with one specific partner that allowed gold to enter at one percentage point below even the new, lower duty. It is now, a year and a half later, asking households to refrain from buying gold in the national interest. The household is being asked to do voluntarily what the government's own tax instrument was loosened to permit. That is the policy sequence the May 10 appeal sits on top of.

The trade agreement is the India-UAE Comprehensive Economic Partnership Agreement, which allows gold imports from the UAE at a rate one percentage point below the normal customs duty under a Tariff Rate Quota. After the 2024 Budget duty cut, gold from Dubai entered India at about 5 per cent duty. The Outlook Business reconstruction notes that gold bar imports from the UAE jumped from $2.9 billion in 2022 to $16.5 billion in 2025. The Global Trade Research Initiative has flagged the route as a likely conduit for third-country gold to be arbitrage through Dubai to take advantage of the lower duty. The UAE neither mines nor refines gold on a significant scale; the bullion comes from elsewhere and is rerouted through a duty-favoured trade partner.

The Reserve Bank's own behaviour on gold tells the parallel story. The RBI purchased 72.6 tonnes of gold in 2024, one of the highest annual purchases by any central bank, taking total holdings to a record 880.2 tonnes. Gold's share in India's foreign exchange reserves rose from 7.7 per cent at the end of 2023 to 15.6 per cent by December 2025 and to roughly 16.7 per cent by early 2026. The RBI also repatriated 64 tonnes of gold from the Bank of England and the Bank for International Settlements in the first half of FY26, reducing its offshore safe-custody holdings to 197.67 tonnes by March 2026, down from 437.22 tonnes in March 2023. The Indian central bank's strategic posture on gold is accumulative. The same period's policy ask of Indian households is the reverse.

There is a different way to do this. The India Bullion and Jewellers Association report, prepared with BDO India in 2024, estimated household gold holdings in India at approximately 35,000 tonnes, most of it sitting outside the formal economy. That is roughly forty times the entire RBI gold reserve. A serious policy on gold imports would have prioritised mobilising this domestic stock through a properly designed monetisation programme, restricted the UAE CEPA arbitrage, and tightened rules of origin on gold entering through trade partners. The Gold Monetisation Scheme, launched in 2015, has underperformed for a decade, with the medium and long-term gold deposits component discontinued in March 2025. The Sovereign Gold Bond programme has been operating below the scale required to displace physical demand. The 2024 Budget moved in the opposite direction on every count.

The deferral request reaches households after the policy choices that made deferral arithmetically necessary have already been made by the same government. The arithmetic does not move toward citizen restraint because citizen restraint was not the variable the government chose to act on.

Foreign travel, after the threshold was raised

The fourth ask is to postpone foreign trips, including overseas weddings and vacations, for at least a year. Outbound travel is described as a foreign exchange leak that citizens can plug through patriotic restraint. The policy record across the last three budgets points the other way.

The window through which an Indian resident sends dollars abroad is the Reserve Bank's Liberalised Remittance Scheme. Each resident is allowed up to $250,000 a year for permissible purposes: education, medical treatment, gifts, maintenance of relatives, and travel. Above a certain threshold, the bank facilitating the remittance must collect tax at source, which the remitter can later claim back when filing income tax returns. The tax is a friction, not a prohibition. It is designed to put a small handbrake on dollar outflows and improve compliance.

The Liberalised Remittance Scheme moved record volumes through this window in 2023-24. Outflows reached $31.7 billion in 2023-24 from $27.1 billion the year before. International travel specifically accounted for $17 billion, up 24.4 per cent year on year. Maintenance of close relatives abroad accounted for $4.61 billion. Studies abroad accounted for $3.47 billion. These three categories explain the bulk of the LRS flow.

The 2023-24 Budget had tightened the friction. It proposed a 20 per cent Tax Collected at Source on most outbound remittances above ₹7 lakh per year, effective October 2023. The 2025-26 Budget loosened it back. The Finance Minister raised the threshold from ₹7 lakh to ₹10 lakh effective April 2025, and removed TCS on education remittances financed by loans from specified institutions. The travel industry welcomed the move. The Crisil director quoted in Business Standard described the measure as providing "tailwinds for the outbound tourism and airline sector." The Finance Ministry's stated logic was tax simplification and relief for middle-class travellers. The dollar-flow consequence was the predictable one: a higher threshold meant more outbound rupee conversion, without the small fiscal friction that the lower threshold had imposed.

The Prime Minister's appeal a year later asks the same middle class to do voluntarily what the tax instrument was designed to discourage and was then weakened to permit. It is the equivalent of loosening a child's seat belt and then asking the child to please sit still. A government with a serious view on outbound consumption during a balance-of-payments crisis has options that do not require speeches: it can raise the TCS rate above the ₹10 lakh threshold, introduce surcharges on premium-class travel, require foreign exchange purchase documentation tied to passport-based travel, or cap LRS for specified categories under emergency provisions. None of these have been signalled. The household is being asked to bear what the policy instrument was not asked to.

The Travel Agents Association of India told the Asia News Network that the tourism industry "may now experience increased pressure to promote domestic tourism, where margins and revenues are comparatively lower." Domestic substitution is the right policy direction in a forex crunch. The supply-side investment to make it viable, through transport infrastructure, destination capacity, and price competitiveness against shorter foreign holidays, has not been the focus of the last three Budgets. The travel ask is reasonable on its face. What it cannot disguise is that the same government raised the TCS threshold a year ago and is now asking households, a year later, to do voluntarily what the threshold was raised to permit. The planning was inverted in real time.

Work from home, in cities still being designed for cars

The fifth ask is to revive work-from-home and virtual meetings. The framing is conservation of fuel and reduction of office travel. The framing is reasonable on its face. The policy record on what made physical commuting necessary in the first place is the deeper question.

Compare two numbers from the same Union Budget. The 2026-27 Budget allocated ₹3.09 lakh crore to the Ministry of Road Transport and Highways, mostly for national highways. The same budget allocated ₹28,740 crore for metro and mass rapid transit projects nationwide, down from ₹31,000 crore the year before. The PM E-Drive scheme, which is the central support line for electric bus and electric vehicle procurement, was cut to ₹1,500 crore from ₹4,000 crore, a 62 per cent reduction in a year when the same government was already in conversation about the energy implications of a possible regional conflict. The 2026-27 highway budget runs at roughly 11 times the metro budget and over 200 times the EV support budget. The numbers describe the priority structures of the last decade and the current one. The country is being built for cars, even as households are being asked to drive less.

The Vahan database shows that of 58,936 new buses registered in India in 2024, only 3,616 were electric. The total electric bus fleet stood at roughly 10,000 vehicles across 50 cities by 2025, with another 20,000 in various stages of procurement under the PM e-Bus Sewa Payment Security Mechanism, which has a planned outlay supporting over 38,000 electric buses by 2028-29. India has 11 lakh on-road buses today, with the number expected to rise to 16.5 lakh by 2030. The country's bus stock per capita remains among the lowest of any major economy. ITDP India's reading of the 2025 budget noted that allocations for walking and cycling infrastructure were essentially absent.

The work-from-home ask treats commute as a private optimisation problem. The structural problem is that India's cities have been built around private vehicle commute because the public transport investment to do otherwise was not made at the scale required. The COVID-era work-from-home revival the Prime Minister invoked was a response to a public health emergency. The current ask is a response to a fuel emergency. The transferability of the response is not what the appeal assumes. COVID work-from-home was possible for the IT engineer in Bengaluru with broadband, a laptop, a quiet room, and an employer that could process payroll through Slack. It was not possible for the mason on a Mumbai construction site, the salesman in a saree shop in Kanchipuram, the auto-rickshaw driver in Hyderabad, the tailor in a Karol Bagh tailoring shop, or the cook commuting from Bhiwandi to a Mumbai office canteen. The country's working population that depends on physical presence, in construction, manufacturing, retail, transport, hospitality, agriculture, domestic work, and street vending, was not eligible for the COVID adjustment and is not eligible for this one. The ask is targeted at the formal salaried segment that is approximately 8 per cent of the workforce.

The deeper question the work-from-home ask raises is the one I have written about before: the manufacturing window that closed before workers leaving farms could pass through it, the agricultural employment share rising from 44.1 per cent in 2017-18 to 46.1 per cent in 2023-24, and the absence of the urban formal sector that would have absorbed those workers into the kinds of jobs where work-from-home is even an option. The country whose structural transformation has reversed does not have the labour market composition in which the appeal makes economic sense.

Buy Indian, after the components were not made here

The sixth ask is to prioritise Made in India products, including everyday goods such as shoes, bags, and accessories. The framing is import substitution at the consumption end. The policy record is the Production Linked Incentive scheme.

The PLI scheme, launched in April 2020 with a cumulative outlay of ₹1.97 lakh crore across 14 sectors, was the Modi government's signature manufacturing intervention. The design is performance-linked: companies receive incentive payments on incremental sales from products manufactured in approved domestic facilities. The state pays the firm a small share of every additional rupee of qualifying output. By March 2025, investments realised across the 14 sectors stood at ₹1.76 lakh crore under 806 approved applications, with cumulative production and sales of about ₹16.5 lakh crore. Total incentive disbursement was ₹21,534 crore by June 2025, roughly 11 per cent of the total outlay. The scheme is scheduled to phase out by mid-2026.

The headline numbers are real. Mobile phone production rose from ₹2.13 lakh crore in 2020-21 to ₹5.25 lakh crore in 2024-25, with mobile exports rising eightfold to ₹2 lakh crore. Pharmaceutical bulk drugs moved from a net import deficit of ₹1,930 crore in 2021-22 to a net export surplus of ₹2,280 crore in 2024-25, the single clearest success of the scheme. The component arithmetic is where the question sits.

The Cabinet approved a separate Electronics Component Manufacturing Scheme worth ₹22,919 crore in March 2025. The new scheme was, in effect, an acknowledgement that the original PLI had grown assembly capacity without growing the domestic components base. The KPMG India reading notes that India's electronics manufacturing remains dependent on imported components, predominantly from China, across printed circuit boards, surface-mounted passive components, lithium-ion cells, capacitors, inductors, resistors, connectors, and magnetics.

A simple way to picture the gap is to look inside a Made in India mobile phone. The shell, screen glass, chip, battery, camera module, speaker, and antenna components are mostly imported. The phone is then assembled at a facility in Sriperumbudur or Noida, packaged in an Indian box, and labelled 'Made in India'. The label is technically accurate; the value added inside the country is closer to assembly than to manufacturing. The trade balance benefit from a labelled-Indian smartphone is therefore much smaller than the headline production number suggests. A Made in India shirt stitched from imported cotton fabric, with imported zippers and labels, operates on the same logic. India's electronics import bill from China has risen across the PLI years, even as electronics exports have risen, because the assembly model imports more inputs to produce more outputs.

The ask to buy Indian shoes, bags, and accessories is the consumer-end version of this problem. India's textile and footwear exports remain below the trajectory that the PLI for textiles, with an outlay of ₹10,683 crore, was meant to enable. The man-made fibre exports rose from ₹499 crore in 2023-24 to ₹525 crore in 2024-25, a one per cent increase in a category in which Bangladesh and Vietnam compete on substantially lower per-unit cost. The footwear and leather sectors did not receive a dedicated PLI scheme. The everyday consumer products invoked in the appeal fall outside the manufacturing categories in which the government's incentive instrument operated.

A serious Buy Indian ask requires the supply side to be present. The supply side requires a components base, a power tariff structure favourable to small manufacturers, a labour market in which contract enforcement runs in both directions, a logistics system priced competitively with rival exporters, and a financial system that allocates working capital to micro and small enterprises at non-extractive rates. None of these is guaranteed by moral suasion at the consumer end. The PLI design was selective in its sector coverage, focused on incremental sales rather than value chain depth, and is now phasing out. The Component Manufacturing Scheme, which addresses the original design gap, is in its first year. The eleven-year self-reliance programme is being asked to compensate for itself at the household consumption end because its production-side delivery did not arrive on schedule.

The fiscal subtext

The six asks share an underlying fiscal subtext that is rarely named in the speeches but visible in the ledger.

The Centre cut the special additional excise duty on petrol by ₹10 per litre and on diesel by ₹10 per litre in March 2026, after the war began, to absorb a portion of the under-recoveries faced by the state-owned oil marketing companies. The annualised fiscal impact has been estimated at roughly ₹1.55 trillion. The duty cut was made before the state elections concluded on May 4 and was the principal reason retail fuel prices remained unchanged through the campaign period. The CII's proposal for a staged reintroduction of the ₹10 fuel excise appears to be the next step in a sequence that begins with moral suasion and ends with price pass-through. The signalling is what the Crisil chief economist Dharmakirti Joshi described as the government moving from voluntary restraint to a price signal. A retail fuel price hike is the most likely fiscal instrument to follow the appeal.

The simultaneous developments are the income tax cuts in the 2025-26 Budget, which the PRS Legislative Research analysis of the 2026-27 Budget shows produced a revenue gap of ₹1.26 lakh crore against the budgeted estimate, and the scrapping of the windfall tax on oil companies, which removed a captured-rent instrument the government had used during the 2022-23 oil price spike. The fiscal arithmetic of replacing direct tax revenue from higher earners with indirect tax revenue from fuel falls on the same households the appeal is now addressing. The CAG Report No. 6 of 2026 raised concerns about precisely this shift in composition in the Centre's books. Transport and cooking fuel are a larger share of monthly expenditure for lower-income households than for high earners; a fuel excise hike that compensates for an income tax cut is, in distributional terms, a transfer from poorer households to richer ones.

The appeal is a precursor to fuel price increases. It is also a deflection from the corresponding tax-side decisions that produced the revenue gap the fuel price increase is meant to close.

What follows from the arithmetic

The wartime context is real. The Strait of Hormuz remains effectively closed. Brent crude has crossed $126. The rupee is at 94.28 to the dollar. India does not have the strategic reserve depth, the domestic production, or the manufacturing base to insulate households from this kind of shock. These are facts. None of them is a counterargument to the six asks themselves. Citizens of any country with an import profile like India's would accept short-term restraint during a supply shock of this magnitude. The asks, taken individually, are reasonable.

The argument is about what gave rise to the need for them and what the restraint is being asked to do. The need for the asks is the consequence of planning failure: 11 years during which the policy framework for every category named in the May 10 speech moved in a direction that increased rather than reduced India's exposure to a Hormuz-scale shock. None of those policy decisions was taken under wartime conditions. They were taken in years of relative macroeconomic comfort, with substantial petroleum tax windfalls funding the fiscal deficit, in the period before the war that the May 2026 appeal is now ostensibly responding to. The appeal lands in a country whose vulnerabilities are the product of those decisions.

If the appeal were paired with a clear commitment that the same policy decisions, the duty cuts on gold, the TCS reductions on outbound travel, the under-investment in strategic reserves, the road-vs-bus budget asymmetry, the PLI design choices, and the hollowing of ONGC, would be reversed within the same emergency window, the moral suasion would be coherent. The appeal would be a public-private contract: households absorb the immediate hit, and the government corrects the structural failures that produced the exposure. Nothing in the May 10 and May 11 speeches indicated such a corresponding government commitment.

A serious response to the current crisis runs through the policy ledger, not through the household budget. The Phase II SPR at Chandikhol and Padur needs an accelerated construction timeline, not the six-year private leasing approach. The gold import duty needs to revert to its earlier level, the UAE CEPA rules of origin need to be tightened, and a properly designed Gold Monetisation Scheme needs to draw on the 35,000 tonnes of household stock that the IBJA documented in 2024. The TCS threshold on LRS needs to revert to ₹7 lakh with rate increases on high-value tour packages and overseas wedding categories. The PM e-Bus Sewa allocation needs to scale by an order of magnitude, against a corresponding reduction in road and highway capex, with the rebalancing visible in the next Budget. The PLI successor instrument needs to be designed around component value addition rather than incremental sales of assembled products. ONGC needs to be released from the disinvestment-and-debt structure the Centre imposed on it and allowed to deploy capital at the exploration scale required.

These are not exotic policy moves. They are the moves the appeal's underlying arithmetic logically requires. They were available before the war started. They are available now.

There is a separate question about the asymmetry between the asks and the conduct of the office, making them. The Ministry of External Affairs filed in the Lok Sabha on February 13, 2026, that the Prime Minister's foreign trips between 2015 and 2025 cost the exchequer ₹762 crore, with expenditure crossing ₹175 crore in 2025 alone. The 2022-24 Rajya Sabha reply put expenditure on 38 trips over those years at approximately ₹259 crore. These are the costs of the office, not of the individual; they cover security, official delegation, media contingent, and logistics.

The Manmohan Singh decade involved 73 foreign visits and ₹795 crore in chartered flight expenses across ten years; the Modi tenure has compressed comparable foreign engagement into a higher per-year cadence. The recommendation to households is calibrated against a public office whose own travel calendar moves in the opposite direction. The same pattern holds for government advertising: RTI replies put central publicity expenditure at ₹4,343 crore between June 2014 and early 2018, at a per-year rate substantially above the UPA's ₹2,658 crore over a full decade.

The 1990 lesson, returning

In March, I wrote that the 1990 Gulf crisis taught India a lesson it has not internalised: that wars fought by powerful countries for their own reasons arrive uninvited at the doorsteps of countries that had no part in starting them. Thirty-six years after India pledged gold to the Bank of England and the Union Bank of Switzerland to avoid sovereign default, the country imports more oil than it did then, from the same region, through the same strait, with the same vulnerability.

What changed in the intervening decades was supposed to be structural autonomy, which would prevent the next crisis from reaching households as the 1990 crisis did. The reforms of 1991, the build-up of foreign exchange reserves to over $700 billion, the diversification of supply, the development of strategic petroleum storage, the growth of domestic manufacturing, and the consolidation of macroeconomic stability were the substance of that autonomy. The 1990 crisis was supposed to be the last time households would be asked to absorb a shock; the policy framework had not been prepared for it.

The May 2026 appeal indicates that the preparation was not completed. India's strategic reserve holds 9.5 days of national consumption. The IEA recommends 90. The country's edible oil production meets 44 per cent of demand against a 2030-31 target of 72 per cent. The current account deficit has widened, the rupee has fallen, reserves have been drawn down, and import dependence in every category named in the speech has either risen or stayed flat across the Modi years. The asks are not unreasonable in their substance. They are the asks one country makes of another in a crisis, recast as the asks a state makes of its citizens, because the planning that would have made the asks unnecessary was not done.

The lesson from 1990 was that sovereignty over the household economy required sovereignty over the structural economy. That sovereignty is what eleven years of self-reliance branding were supposed to deliver. What was delivered instead was a strategic petroleum reserve still at 1990s scale, an upstream oil company hollowed out to meet the Centre's disinvestment targets, an edible oil mission approved seven years late, a gold duty cut at the moment imports were surging, an outbound travel tax loosened a year before the appeal to defer outbound travel, a public transport budget that runs at one ten-thousandth of the highway budget, and a manufacturing programme that built assembly capacity without a components base. These are not wartime decisions. They are peacetime decisions whose consequences only became apparent with the war. The asks of May 10 and May 11 are the closing entries in a planning ledger that was visibly failing for years before the Strait of Hormuz closed.

The bill is being presented to citizens. The ledger that produced the bill has not been presented at all.

Varna is a development economist and writes at policygrounds.press.

Further Reading

On the war and its costs

1. "The Price of Someone Else's War: What the US-Israeli Bombing of Iran Costs India and the World", Varna, March 19, 2026

2. "Less gold, less travel: Indian PM Modi urges austerity as oil prices surge", Asia News Network, May 2026

3. "The meaning of energy sovereignty", Gurdeep Singh Sappal, National Herald, March 22, 2026

On the structural ledger

1. "The Road That Runs Back: India's Reverse Structural Transformation", Varna, May 1, 2026

2. "Reading the Centre's Books: What CAG Report No. 6 of 2026 Tells Us About Union Finances", Varna, 2026

3. "Review of Policy on Import of Crude Oil", Standing Committee on Petroleum and Natural Gas, PRS Legislative Research

On the substitution programmes

1. "Challenges in Meeting Ethanol Fuel Blending Target by 2025-26", Arcus Policy Research, The India Forum

2. "Ethanol blended petrol for energy security: India's self-goal?", Lydia Powell, ORF

3. "National Mission on Edible Oils", Press Information Bureau

On gold, forex, and the trade balance

1. "Why Gold Has Become India's New Forex Flashpoint", Outlook Business

2. India Bullion and Jewellers Association report on gold in India, prepared with BDO India (2024)

3. "India's External Debt: A Status Report 2024-25", Department of Economic Affairs

On the Modi government foreign travel

1. "PM Modi's Foreign Trips Between 2015-2025 Cost Exchequer Rs 762 Crore", The Wire, February 2026