The report also flags risks to remittances from Gulf countries, which support millions of households.
West Asia Conflict May Push 25 Lakh Indians Into Poverty, UNDP Warns of Rising Costs
A widening conflict in West Asia could slow India’s development gains and push millions closer to poverty, according to a recent assessment by United Nations Development Programme. The analysis, titled “Military Escalation in West Asia: Implications for Human Development in Asia and the Pacific,” highlights how rising global tensions are already feeding into higher costs and economic stress across Asia.
For India, the risk is significant. Early estimates suggest the number of people affected by poverty could climb sharply, potentially reaching around 25 lakh in a severe scenario. This would also slightly reverse progress in the country’s Human Development Index, indicating a setback in living standards, education, and health outcomes.
The pressure is being transmitted through multiple channels:
- Rising fuel and raw material costs reducing household purchasing power
- Increased freight charges and supply disruptions affecting trade
- Strain on government finances and welfare spending
- Growing food insecurity due to higher import costs
India’s dependence on West Asia adds to the vulnerability. A large share of crude oil, LPG, and fertilizers is sourced from the region, making domestic prices sensitive to disruptions. At the same time, delays in shipping and higher insurance costs are impacting exports and imports.
The report also flags risks to remittances from Gulf countries, which support millions of households. Any prolonged instability could affect jobs, incomes, and small businesses, particularly in sectors like construction, food processing, and textiles.
The report highlights the importance of strengthening supply chains and diversifying energy sources to reduce such risks.
