Energy shock looms large over India’s state elections

India’s state election cycle kicks back into gear next month with the energy shock from the Iran conflict reverberating across the country. That raises the stakes for New Delhi: if the crisis continues, the votes risk becoming an implicit test of the Modi government’s management of it. For markets, the key question is whether cushioning the shock, through subsidies or other fiscal support, ultimately forces a looser fiscal stance and pushes bond yields higher.