Bangalore: Federation of Indian Chamber of Commerce and Industry (FICCI) president A C Muthiah on March 20 said that if the Iraq war extends upto three months, it would cast "gloom" on India with oil prices going upto 45 per cent and growth rate dropping to 2.5 per cent.

"If the war goes on for three months, it is gloom. Because 60 per cent of India's oil requirements is being imported and oil prices will go up by 45 per cent. Our growth rate will drop to 2.5 per cent," Muthiah said at the inaugural of FICCI seminar on Value Added Tax (VAT).

According to a FICCI research, he said, if there was a short-term war of a week, prices would shoot up by 9 per cent.

However, Muthiah also said Indian engineering firms would get enormous opportunity in rebuilding Iraq in the aftermath of the war.

"The aftermath of the war will give great opportunity for Indian engineering companies. We should be prepared to use Dubai as an entry point for steel and construction companies to supply steel and cement among others, he told reporters on the sidelines of the conference.

"We should chose Dubai as a "warehouse" and move the goods. The opportunity in the aftermath of war is "fantastic", he said.

PTI