Monsoon reaches Kerala two days ahead of schedule

 New Delhi/Mumbai: Amid a searing heatwave in parts of India and landslides and floods in others, the south-west monsoon marked an early entry Thursday, two days ahead of schedule.

The monsoon has set in over Kerala in southern India and already advanced into most parts of northeast India, the India Meteorological Department (IMD) said in a statement Thursday afternoon. The monsoon’s entry was preceded by widespread rains over the past few days in these states.

The four-month long monsoon season, beginning June, is a lifeline for much of the country, particularly for rural areas dependent on farming. It brings in three quarters of India’s annual rainfall--watering crops, filling up reservoirs, and boosting farm incomes and consumer demand.

Also read: Mint Quick Edit | Will heat deliver a torrential monsoon this year?

The monsoon is never a straight story and its distribution over time and geographies will be key, said Dharmakirti Joshi, chief economist at Crisil. “The good news is that rains are forecast to be above normal,” said Joshi. “Farm and wage incomes are likely to improve. A good harvest will cool food prices, particularly cereals like rice and some varieties of pulses.” Food inflation has been hovering at over 8% for the past six months.

Typically, after entering Kerala and touching the northeast, the monsoon gradually progresses through the country, reaching the northernmost parts between end-June and early July.

The IMD has forecast above-normal rains at 106% of the 50-year or long-period average (LPA) this year. Rains are likely to be above normal in most rain-fed farming areas, the weather office said earlier this week in an updated forecast. It attributed a 61% probability to above normal (105-110% of LPA) and excess rains (over 110% of LPA), which raise the risk of possible floods in some parts of the country.

Also read: Above-normal rains seen, says IMD; monsoon over Kerala in five days

The monsoon is critical for India’s vast farm economy, which employs over 45% of its workforce and contributes about 15% to its gross domestic product (GDP). Uneven rains were a reason why farm sector growth rate plummeted to a low of 0.7% in 2023-24, compared to 4.7% in the previous year.

Rural markets have been weak for the past six quarters for the home appliances industry, said Anuj Poddar, managing director and chief executive, Bajaj Electricals Ltd. “Coming on the back of an intense summer, a favourable monsoon will imply a strong second half of the year vis-à-vis demand. The outlook will be much better than last year,” he said.

Combating food inflation, with non-food inflation already being low, can provide policy room for interest rate cuts, Crisil Research said in a note Thursday.

It added that above-normal temperatures predicted in June, when planting for the Kharif crop season begins, could impact the availability of labour or the ability to work under extreme conditions. High temperatures can also deplete reservoir levels, which are already 24% below capacity.