‘Prepare For The Worst’: Did Uday Kotak Just Sound Alarm Over Iran War?

Uday Kotak, founder of Kotak Mahindra Bank, on Tuesday strongly backed Prime Minister Narendra Modi’s recent remarks on austerity and controlled consumption, saying India must prepare for prolonged global uncertainty and avoid “living beyond its means.” Speaking during interactions with industry leaders at the CII Annual Summit, Kotak said the Prime Minister’s comments reflected a much larger concern around India’s economic resilience at a time of geopolitical instability and rising energy-related risks across the world.

Referring to the ongoing conflict in West Asia, Kotak described the situation as “a much more bigger, much more complex problem than it sounds,” while stressing that India must stay prepared for external economic shocks. He said the Prime Minister’s message about reducing unnecessary consumption should be understood in the larger context of strengthening the country’s economic balance sheet and long-term financial stability.

Banker says PM Modi’s message on reducing unnecessary spending carries ‘deep meaning’

Explaining his views further, Kotak said there are several simple but important steps a country can take during uncertain times. “There are some simple things that a country can do, which is to moderate unnecessary consumption, which is counterproductive. I will see it in terms of the country’s P&L and balance sheet,” Kotak said.

The veteran banker also recalled an earlier statement by PM Modi where he had urged Indians to hold weddings inside the country instead of spending heavily on overseas celebrations. According to Kotak, the message went beyond symbolism and reflected a larger economic strategy focused on self-reliance and reducing unnecessary outflow of money. “It was a very simple thing he said, but it had deep meaning,” Kotak noted. “A truly atmanirbhar, self-reliant country is the one that does not need to depend on somebody else’s money or power.”

Uday Kotak warns global economy is shifting away from interconnected growth model

Kotak also spoke about the changing nature of the global economy and said the world has moved away from the interconnected system that dominated international trade and growth for decades. According to him, countries are now increasingly prioritising protectionism and self-reliance. “What we have seen play out today is the exact opposite, each one for yourself,” he said. “If you live beyond your means, sooner or later, the day of reckoning comes.”

He warned that the full impact of the ongoing Middle East conflict on global fuel prices and supply chains has not yet reached Indian consumers and businesses. According to Kotak, the effects may become much more visible in the coming months as energy costs begin affecting multiple sectors.

‘The shock is coming’: Kotak says businesses and consumers must prepare now

Speaking about the possible economic impact of rising energy prices, Kotak cautioned that the situation could become difficult for people with limited incomes as fuel-linked costs begin increasing across industries. “We have not seen the impact in the last two months of the Middle East war in terms of energy price transmission. It’s coming. And it’s coming big,” he said.

“The shock is coming,” Kotak added, while urging businesses and policymakers to prepare themselves in advance instead of reacting after the crisis deepens. “My view is we should prepare for paranoia before the event. And we must hope that tough times do not come or remain. But we must prepare for the worst.” Kotak also urged Indian companies to focus on long-term competitiveness, investments and future growth rather than short-term stock market gains. He argued that India had “financialized too early” and corporates now need to adopt a more strategic and sustainable approach for the future.

(with inputs from ANI)

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