The current study intends to find out the linkages between crude oil prices and economic activity in the context of Indian economy. The macroeconomic variables such as gross domestic product (GDP), unemployment, industrial output, inflation, exchange rate and stock market prices have been used as a proxy to economic activity. We have analysed the sample data of 30 years, that is, from year 1991 to 2020. To inspect the short-run relationship between oil prices and the above-mentioned macroeconomic variables, Granger causality test has been applied after removing the presence of unit root through differencing the series. To investigate the long-run relationship, vector error correction model (VECM) has been applied after testing cointegration through the Johansen method of cointegration. The findings of the study show that oil prices have short-run causality with all the variables, that is, GDP, unemployment, industrial output, inflation, exchange rate and stock market prices, while they have a long association with inflation, industrial production and unemployment. Further we find a negative relationship between oil prices and unemployment, industrial output, inflation and exchange rate and a positive relationship with GDP and stock prices.

当前的研究旨在找出印度经济背景下的原油价格与经济活动之间的联系。诸如国内生产总值（GDP），失业率，工业产出，通货膨胀，汇率和股票市场价格等宏观经济变量已被用作经济活动的代表。我们分析了1991年至2020年这30年的样本数据。为检验油价与上述宏观经济变量之间的短期关系，在去除了单位根的存在之后，进行了格兰杰因果关系检验。通过区分系列。为了研究长期的关系，在通过Johansen协整方法测试协整之后，应用了矢量误差校正模型（VECM）。该研究的结果表明，油价与所有变量（即GDP，失业率，工业产出，通货膨胀，汇率和股票市场价格）具有短期因果关系，而与通货膨胀，工业生产和失业。此外，我们发现石油价格与失业，工业产值，通货膨胀和汇率之间存在负相关关系，与GDP和股票价格之间存在正相关关系。