Finance Minister Nirmala Sitharaman has said India successfully navigated the economic fallout of the West Asia crisis — which began on 28 February — and continued to hold its position as the world's fastest-growing major economy, driven by strong growth, new free trade agreements, and resilient domestic consumption. Sitharaman made these remarks in an interview with leading French newspaper Le Figaro, speaking to Fabrice Node-Langlois, Editor-in-Chief (Economics).

The Three Fs: India's Crisis Management Formula

Sitharaman outlined a concise framework that guided the government's response to the crisis. 'I've taken to summarising the Prime Minister's advice with a simple formula: preserve the three Fs, for fuel (meaning oil and gas), fertiliser, and foreign exchange,' she was quoted as saying.

On 10 May, Prime Minister Narendra Modi had urged citizens to avoid international travel, defer gold purchases for a year, and reduce car use and cooking oil consumption. Sitharaman explained the rationale: 'All imports, not just essential goods, are paid for in foreign currency, such as the dollar. By encouraging carpooling, for example, we preserve foreign exchange reserves.'

Fertiliser Subsidies and the Farmer Shield

The Finance Minister highlighted that the government had maintained fertiliser subsidies to protect farmers from global price shocks. 'We have maintained subsidies on fertiliser purchases, which can amount to 2,700 rupees (25 euros) on a bag costing 3,000 rupees (28 euros). We haven't increased the price paid by farmers, but this comes at a cost in foreign currency,' she said.

This commitment to farm-gate price stability, even as global commodity markets remained volatile, reflects the Centre's strategy of absorbing import costs rather than passing them on to agricultural households.

Gold Imports and the Foreign Exchange Equation

Sitharaman also addressed the politically sensitive appeal to reduce gold imports. 'Gold is sacred to Indian families. It is offered in temples, it is kept for the daughters of the family. And yet, we had to explain to households, who accumulate large quantities of gold, that importing it requires paying in foreign currency,' she said.

India is among the world's largest consumers of gold, and the metal represents a persistent pressure on the current account. The government's appeal to defer purchases was framed as a collective fiscal responsibility rather than a restriction.

EU-India FTA and the Trade Dividend

On the trade front, Sitharaman highlighted the significance of the free trade agreement signed between India and the European Union last January, following protracted negotiations. She told Le Figaro the deal 'will have a considerable impact on global trade itself' and noted that 'the Indian middle class is a powerful driver of consumption' — a key draw for EU exporters and investors.

India-France Economic Dialogue in Aix-en-Provence

On the sidelines of her European visit, Sitharaman co-chaired the India-France Economic and Financial Dialogue (EFD) in Aix-en-Provence alongside Roland Lescure, France's Minister of Economy, Finance, Industrial, Energy, and Digital Sovereignty. The two sides discussed greater bilateral cooperation in critical minerals, economic sovereignty, security policies, and deepening financial-sector linkages.

An official statement noted that 'resuming high-level exchanges on international outlook, bilateral cooperation and outcome-oriented solutions had become essential' as the economic relationship between India and France deepens within their special global strategic partnership. With the EU-India FTA now in place and the India-France dialogue institutionalised, New Delhi's economic diplomacy is set to intensify through the remainder of 2025.