Raghuram Rajan's warning to India after Hormuz shock: Build bigger oil reserves, diversify faster

Former RBI Governor Raghuram Rajan has urged India to build larger strategic oil reserves and diversify import sources after the Hormuz disruption exposed energy vulnerabilities, noting the strait handles a large share of India's crude, LNG and LPG imports. He flagged a 12.5% incoming US tariff on forced-labor concerns and warned of a possible separate excess-capacity probe that could stack additional duties. Rajan linked the rupee's roughly 14% two-year depreciation to weak FDI rather than oil alone, and pushed for a three-to-five-year view on critical commodity exposure including pharmaceutical inputs.