India’s monsoon, which brings more than 70 per cent of the country’s rainfall, landed two days early, potentially boosting production of rice and sugar and helping cool the highest inflation among Asia’s major economies.
The rain reached southern Kerala and Tamil Nadu and is likely to advance to the rest of Kerala and Karnataka in the next two to three days, said the India Meteorological Department in a statement on Monday. The bureau predicted May 13 that showers would reach Kerala tomorrow.
Abundant rain may boost rice, corn, sugar, cotton and oilseed harvests, helping growth and curbing inflation in a country where farming represents a fifth of the economy. Bumper crops may prompt the government to ease export curbs, capping global food costs the United Nations says reached a record in February. Some 235 million farmers depend on the rains to boost incomes and fund purchases of tractors, cars and televisions.
“This year’s monsoon is even more important because there are worries about the economy slowing down as a result of policy tightening,” said Sonal Varma, a Mumbai-based economist at Nomura Holdings Inc. “Given the risks of inflation, the last thing we need is a bad monsoon and food prices spurting.”