The all-India rainfall was above normal at 108% of the long period average (LPA) in the Southwest (SW) Monsoon season 2025, in line with the Indian Meteorological Department’s (IMD’s) forecasted range, even as the spatial distribution remained uneven. Aided by the early onset of Monsoon and surplus rains, the cumulative kharif sowing was up by 0.6% year-on-year (YoY) at end-September 2025. However, large excess rains and flooding in some parts of the country in late August 2025 and early-September 2025, coupled with the late withdrawal of Monsoon from some regions pose a concern to the timely harvest and eventual yield of the standing crops. Looking forward, the healthy increase in the minimum support prices (MSPs) for major rabi crops such as wheat, along with elevated reservoir levels augur well for the upcoming rabi sowing season. Overall, ICRA expects the agri GVA growth to print at 3.3% in FY2026 (+4.6% in FY2025 PE). Rural demand is expected to remain healthy, aided by favourable crop outcomes and upbeat outlook, improving consumer sentiments, as well as the likely favourable impact of the GST rate rationalisation.
