India's real GDP growth is anticipated to moderate to 6.5% or lower in FY27, influenced by a significant rise in crude oil prices due to the ongoing crisis in West Asia. Credit rating agencies Icra and Care Ratings have adjusted their forecasts, with Icra estimating growth at 6.5%, down from a previous 7.1% projection, based on an average crude price of over $85 per barrel. Care Ratings warns that if prices reach $120 per barrel, growth could decline to 6%, with inflation surging to 6.4-6.6%, surpassing the Reserve Bank of India's (RBI) upper limit. Despite these challenges, Crisil suggests that strong balance sheets in many industries may cushion against credit risks. The Indian economy's heavy reliance on imported oil makes it vulnerable to fluctuations in global fuel prices, which have been exacerbated by the Iran war. The agencies also predict a slowdown in credit expansion to about 13% this fiscal year, down from 14% in FY26, due to concerns over asset quality, particularly in export sectors.