Above-normal May rainfalls may cushion India's growth outlook as global risks mount

As global risks threaten growth and stoke inflation, early signs of strong pre-monsoon rainfall could provide a domestic cushion by boosting farm output and easing food prices.

The India Meteorological Department (IMD) on Friday forecast above-normal rainfall in May and a timely arrival of the southwest monsoon over the Andaman and Nicobar Islands—developments that could lift rural demand, support farm output and add momentum to economic growth.

"Our forecasting system show that conditions for the arrival of the south-west monsoon are becoming favourable between May 15 and 20," said Mrutyunjay Mohapatra, director general, IMD, while adding that the country is likely to receive above-normal rains in May.

The weather forecaster is likely to announce the onset date for monsoon in the second week of May.

Rainfall cushion

A favourable start to the monsoon cycle is critical for India’s economy, where agriculture accounts for 15-16% of GDP and supports nearly 46% of the population. Strong rainfall typically boosts farm incomes, lifts rural consumption, and helps ease food inflation, improving overall purchasing power.

Economists estimate that a good monsoon could add 20–40 basis points to India’s GDP growth, currently projected at 6.5–6.8% for FY27, according to the Reserve Bank of India and multilateral agencies such as the International Monetary Fund.

These projections have come under pressure amid the fallout of the West Asia conflict, which has disrupted energy and food markets and raised the risk of higher inflation and slower consumption.

Retail inflation edged up to 3.4% in March from 3.21% in February, reflecting a rise in food and energy prices following the West Asia conflict. While the reading remains below the Reserve Bank of India’s medium-term target of 4%, the uptick suggests emerging price pressures.

The IMD’s May outlook reinforces expectations of an early boost to the kharif sowing season. With rainfall projected at over 110% of the long period average (LPA) of 61.4 mm, soil moisture levels are likely to improve, enabling timely land preparation and early sowing of crops such as paddy, pulses and oilseeds, particularly in rain-fed regions. The LPA of rainfall over the country as a whole during May, based on data of 1971-2020, is about 61.4 mm. Last year, May received 106% of the normal rainfall.

“A better rainfall in May is likely to support higher sowing, particularly for key kharif crops such as rice, pulses and oilseeds, which in turn should improve overall agricultural output. This has positive implications for food security, as higher production helps stabilise supplies,” said Abhash Kumar, assistant professor, economics, Delhi University.

“It can also ease pressure on food inflation, especially if supported by efficient procurement and distribution, as improved crop yields tend to soften prices in the months following the harvest,” Kumar said.

Demand outlook

Rural demand, which has lagged urban consumption in recent quarters, is expected to recover on the back of a favourable monsoon. It is projected to grow 6-7% in FY27, up from about 3-4% last year, based on estimates by brokerages such as ICICI Securities and Nuvama Institutional Equities in April. In good monsoon years, sectors such as two-wheelers, tractors and fast-moving consumer goods typically see a 10-12% volume uptick, according to industry reports and past trend analyses by the Society of Indian Automobile Manufacturers.

Urban demand, meanwhile, remains relatively resilient, expanding at 7-8%, supported by steady salaried income growth and services sector momentum, according to estimates by the Reserve Bank of India in April. Together, private consumption, accounting for nearly 58–60% of GDP, is expected to strengthen, as per national accounts data from the Ministry of Statistics and Programme Implementation for Q3FY26.

Even so, the broader monsoon outlook remains less certain.

On 13 April, IMD projected that the southwest monsoon could be below normal this year at around 92% of the long-period average, where 96-104% is considered normal. The last instance of a below-normal monsoon was in 2023, when rainfall stood at 95%. Forecast models also point to the possible emergence of El Niño conditions during the monsoon season, a phenomenon associated with a warming of the Pacific Ocean and typically linked to weaker rainfall in India.

The southwest monsoon typically reaches the Andaman and Nicobar Islands around 20 May and advances to the Kerala coast by around 1 June. Last year, it arrived over Kerala on 24 May, ahead of the normal date. Monsoon rains were 8% above normal 2025.

This year’s forecast suggests a timely onset over the Andaman Islands.

Regionally, rainfall in May is likely to be normal to above normal across most parts of the country, with the exception of some areas in east and northeast India and east-central regions, where below-normal rainfall is expected.

Pre-monsoon showers are also expected to moderate temperatures in several parts of the country. During May, above normal heatwave days are likely over some parts of the foothills of the Himalayas such as Himachal Pradesh and Uttarakhand , east coast states, Gujarat and Maharashtra.