Page 20 - Policy Economic Report- June'26

POLICY AND ECONOMIC REPORT
OIL & GAS MARKET

The World Bank and S&P Global note that while El Niño is unlikely to derail the global recovery on its own,
it represents an important upside risk to inflation and commodity prices that could amplify existing
geopolitical and supply-side challenges. Strengthening climate resilience through investments in
sustainable agriculture, water resource management, resilient energy infrastructure, and early warning
systems will be critical to reducing the economic impact of future climate-related shocks and supporting
long-term global growth.

6. ADB Commits US$30 Billion to Strengthen ASEAN’s Long-Term Resilience and Regional Integration

The Asian Development Bank (ADB) announced that it will mobilise US$30 billion by 2030 to support the
Association of Southeast Asian Nations (ASEAN) in advancing its long-term development priorities and
enhancing resilience against external shocks. Announced during the 48th ASEAN Summit in Cebu,
Philippines, the initiative aims to strengthen regional integration while supporting sustainable economic
growth, energy security, financial resilience, and digital transformation across Southeast Asia.

The financing package will support five strategic priority areas: deepening regional capital markets,
accelerating the ASEAN Power Grid, strengthening artificial intelligence readiness, promoting the blue
economy, and enhancing river basin resilience. As part of the commitment, around US$6 billion will be
directed towards developing regional capital markets to improve access to long-term finance, while US$5
billion will support expansion of the ASEAN Power Grid to facilitate cross-border electricity trade, improve
grid reliability, and accelerate the deployment of renewable energy across the region.

The initiative reflects ASEAN’s growing emphasis on building resilient regional infrastructure amid
increasing geopolitical uncertainty, climate-related risks, and evolving global supply chains. Enhanced
regional electricity connectivity, stronger financial integration, and greater investment in digital
infrastructure are expected to improve economic competitiveness, reduce energy costs, and strengthen
the region’s ability to withstand external economic and environmental shocks. The programme also
complements ASEAN’s broader objectives of achieving sustainable development, accelerating the clean
energy transition, and fostering innovation-led growth.

For Asia and the Pacific, the announcement reinforces the increasing role of multilateral development
institutions in financing cross-border infrastructure and supporting regional public goods. By promoting
energy connectivity, resilient capital markets, and digital transformation, the initiative is expected to
contribute to stronger regional integration and enhance long-term economic resilience in one of the
world's fastest-growing regions.

7. Indian Economy

Snapshot
India continued to demonstrate strong macroeconomic resilience during the first half of 2026 despite
heightened global uncertainty arising from geopolitical tensions, elevated crude oil prices, slowing global
trade, and tighter financial conditions. Supported by robust domestic demand, sustained public capital
expenditure, resilient private investment, and continued expansion in manufacturing and services, India

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