Abstract
The paper examines the effects of crude oil price shocks on the Indian
economy development and GDP Growth for the period of 2010 till 2018. The
present Indian economy growth has been facing the identical issues of
escalating the trade disparity and continuing inflation. In this
connection, the study focused on the determine relationship between the
speculation and crude oil price impact on the Indian economic
development activity and GDP growth and the paper investigated the how
oil price variations effect on the Indian economy development through
different networks, viz. WPI, CP, IIP, GDP, Monetary policy, trade and
investment. The paper used methods an GARCH model and description to
tool the volatility on both the oil and stock markets and then developed
an extension of the GARCH-M, vector auto-regression (VAR) models are
also applied to determine the oil price shocks effect on macroeconomic
indicators and the outcomes of co integration model propose that crude
oil is pro‐cyclical to output, and the paper used VAR investigation to
the discrepancy decomposition to capture the linear inter‐dependencies
among the variables. The mechanical stability experiments determine that
there is no indication of mechanical break in the VAR model.