ON MAY 10 AND 11, twice within 24 hours, Prime Minister Narendra Modi’s impassioned appeals to his fellow citizens brought back memories of the pandemic days. But the pleas this time were to cut fuel consumption and defer gold purchases, foreign travels, and destination weddings abroad. His aim: to preserve forex reserves amid elevated crude oil prices following the war in the Middle East.

“When supply chains are under pressure, the challenges keep rising, no matter the steps we take,” Modi said. High crude oil prices, coupled with the rampant sale of domestic equities by FIIs and the import of precious metals, have India staring at an impending current account deficit (CAD) crisis.

Elaborating on the math behind the austerity call, a top government functionary told Fortune India that fuel and gold account for about ₹18 lakh crore outgo. “If 1.4 billion Indians can save up to 15-20% of this amount, our entire CAD will be taken care of. The Indian economy is strong and resilient,” he says. The last available official figures put India’s CAD at ₹1.1 lakh crore as of Q3FY26.

While experts welcome the move, they say the Centre may have to take “stronger measures”. “PM’s appeal may have some positive effect on the Indian macro, with Indian households taking active steps to manage fuel consumption. India’s macro has deteriorated meaningfully since the start of the Middle East war and most parameters look bad even in our base-case scenario. It could turn worse in an adverse scenario of a prolonged conflict with continued disruptions to global oil and gas supplies,” warned Sanjeev Prasad, MD and co-head, Kotak Institutional Equities, in a report dated May 12.

Stronger measures may be needed to mitigate the impact of reduced supply of crude oil and natural gas and high crude oil and gas prices, “given the negative impact both on the Indian economy, especially on CAD/BoP (Balance of Payments) and fiscal/inflation”, he added. That said, the government has already bitten the bullet with four hikes in fuel prices within 10 days in May.

The government has also set the ball rolling on curbing gold imports. The import duty on gold, silver, and other precious metals has been hiked. As a result, the effective import duty on gold and other precious metals, including cess, has been hiked almost 2.5 times from 6% to 15%.

The revised duty has already come into force. According to the notification, the government imposed a 10% basic customs duty and a 5% Agriculture Infrastructure and Development Cess on gold and silver imports. Later, the government also put silver imports in the restricted category, mandating prior approval.

In a landmark move, India, which has been scouting for crude oil from alternative sources, has entered into a strategic collaboration between Indian Strategic Petroleum Reserves Ltd and Abu Dhabi National Oil Company, allowing New Delhi to park its reserves there. Further, sources say the Centre is in the process of identifying non-essential imports. Hence, more curbs are likely to be announced. According to RBI, India’s forex reserves fell sharply by $8.09 billion to $688.89 billion in the week ended May 15. It is perhaps time for India to go all guns blazing on reforms, self-restraint, calibrated fuel price hikes, and diplomatic avenues to find alternative sources of energy to tide over the crisis.