High and fluctuating global crude oil prices, unimaginable increase in fertilizer prices and high gold prices amid the West Asia conflict are creating challenges on the external front as payments for all these commodities have to be made in foreign exchange, said Union Minister for Finance & Corporate Affairs Nirmala Sitharaman.
“To just put it in context, all these three payments have to be in foreign exchange. There is no rupee trading there,” she said at event to celebrate SIDBI’s 37th foundation day.
Fuel, fertilizer and forex
Sitharaman urged the audience, which included Special Secretary in the Department of Financial Services Sanjay Lohiya, chiefs of public sector banks and SIDBI top brass, tounderstand the context of the three Fs — fuel, fertilizer and foreign exchange — and the foreign exchange is, in this context, purchase of gold.
“So, we need to understand this and we also should appreciate that the challenges are more externally driven,” she said.
She made the aforementioned statement in the context of Prime Minister Narendra Modi on May 11th giving a call to conserve foreign exchange as far as possible in the backdrop of the West Asia conflict leading to a spike in crude oil prices, which, in turn, has weakened the rupee.
Sitharaman underscored that India’s domestic economic situation remains positive and resilient even today.
But there are naysayers who jump into the scenario as it were and say, everything is crumbling. There is a section which very quickly wants to decry the achievements of our own people.
“...It’s not right is one thing, but it is wrong because it is fear-mongering. India cannot afford fear-mongering. We need to give confidence to the people with our words and with our action, and that’s what you’re seeing at various levels and today you’re seeing it through SIDBI as well,” Sitharaman said.
Challenge for MSMEs
Referring to delayed payments (including State PSUs and commercial enterprises) continuing to be a critical challenge for MSMEs, with an estimated ₹8.1 lakh crore in delayed payments affecting working capital and growth, the Minister emphasised that she periodically reviews the public sector undertakings under the government to make sure that they don’t exceed the 45-day limit by which they have to pay the dues to the MSMEs and they shall not be sitting over their dues.
Sitharaman emphasised that to shield citizens and businesses from the steep rise in global crude prices, central excise duty on petrol and diesel was reduced by ₹10 per litre.
The government is estimated to take a revenue impact of over ₹1 lakh crore on this one score in the year 2026–27 because of this one decision..
Published on May 25, 2026