India is forecasted to receive above-average rainfall in September, exceeding 109% of a 50-year average, according to Mrutyunjay Mohapatra, director-general of the India Meteorological Department. This follows a surplus of 15.3% rainfall in August and 9% in July. The monsoon season, vital for India's agriculture, has recorded 6.9% more rainfall than average since June 1. The heavy rains could damage summer-sown crops like rice and cotton, which are harvested mid-September, potentially leading to food inflation. However, increased soil moisture may benefit winter-sown crops. The monsoon typically retreats by mid-September, but this year’s withdrawal may be delayed, with significant rainfall expected over Rajasthan and Gujarat starting around September 15 [36f1c540].
In light of the recent weather patterns, Indian consumer spending during this year's festival season is expected to be slightly better than in 2022, according to economists polled by Reuters. Consumption, which accounts for about 60% of India's economy, has been slow to recover from the pandemic. Around 75% of economists surveyed believe that spending during this year's festival season, from October to December, will be higher than last year. The sales are a key indicator of the health of consumption, which makes up about 60% of India's GDP. Stronger spending is helping to drive manufacturing activity and underpinning growth of more than 6% in the current fiscal year [c1b348aa].
India's Finance Minister, Nirmala Sitharaman, stated that India's young population will drive consumption demand for the next 30 years, supporting rapid economic growth. The dependency ratio of the young workforce is expected to decline, leading to increased consumption. Consumption currently accounts for nearly 60% of India's GDP. Sitharaman emphasized the need for increased manufacturing and policy support to sustain growth and create jobs. She also highlighted the strength of the corporate and finance sectors and the importance of policy stability in facilitating India's growth [1ea3c7c7].
The rainfall in June has been disappointing, with India receiving 20 percent less rainfall than normal. However, private weather forecaster Skymet believes that the southwest monsoon will accelerate in the coming days and cover the entire country ahead of its schedule. A higher than normal monsoon with balanced spatial and temporal distribution will benefit the agriculture and agrochemical sector and rural demand in general. Monsoon is important to India as it brings nearly 70 percent of the rainfall needed for the agriculture sector. Agriculture contributes about 14 percent to India's GDP. A good monsoon boosts agricultural production, leading to higher disposable income and spending power. Investors can focus on rural themes and agricultural sector themes, such as fertilizer, agrochemicals, tractors, two-wheelers, and FMCG. The government may invest more in rural infrastructure projects due to the favorable monsoon outlook [70614dec].
The Odisha Government has announced that schools in the state will revert to their regular timetable starting from Monday, June 24. The decision comes as the southwest monsoon has covered the entire state, bringing relief from the heatwave and hot & humid weather conditions. The State School & Mass Education Minister, Nityananda Gond, stated that classes will resume as the torrid heatwave conditions have subsided. Steps are also being taken to make students proficient in mathematics, with special education in the subject being implemented in Classes 9 and 10 initially, and later for all other classes [b8d80f6e].
In Manipur, the government has declared a two-day holiday for all state schools starting on July 3, 2024. The decision was made due to the rising river levels and flooding caused by nonstop rain. The Imphal River, the biggest river in the Manipur valley, overflowed and flooded several areas. Residents and officials are working to strengthen the retaining walls and river banks. The holiday is intended to ensure the safety of students and teachers [720904b8].