TOPSHOT - A pistillate husbandman looks astatine her paddy crops submerged successful floodwaters aft the Ravi stream overflowed pursuing dense rains successful a colony adjacent Ajnala, astir 28 km from Amritsar connected September 5, 2025. Flooding crossed the northwestern authorities killed astatine slightest 29 radical and affected implicit 250,000 past month, with the state's main curate calling it "one of the worst flood disasters successful decades".
Narinder Nanu | Afp | Getty Images
Large swathes of Indian farmland person been affected by floods and torrential downpours, with the cardinal cultivation authorities of Punjab facing its worst floods successful 40 years.
While crops person been damaged, analysts forecast that the wide interaction connected ostentation for fiscal twelvemonth 2026 is not going to beryllium terrible capable to propulsion it past the cardinal bank's midpoint people of 4% — Reserve slope of India's user ostentation people scope is 2% to 6%
Limited interaction connected cereal accumulation and capable stocks are expected to support nutrient ostentation successful cheque implicit the adjacent future, HSBC said successful a study connected Monday, adding that it was "not excessively disquieted astir underlying ostentation momentum."
Breaking its nine-month downward trend, user ostentation successful August inched to 2.1%, from 1.5% successful July owed to a emergence successful nutrient prices compared with the erstwhile month, led by vegetables, edible oil, egg, fish, nutrient and fruits.
The wide interaction of incessant rains is constricted connected ostentation owed to a higher base, but it tin beryllium greater if rains proceed into the harvest season, Bank of America Securities said successful a study connected Friday.
Analysts including astatine BofA expect the chopped successful goods and services tax, which volition travel into unit from Sept. 22, to support ostentation lower.
Reportedly, 3 lakh acres of farmlands person been damaged and according to the Punjab authorities authorities fractional a cardinal radical crossed 23 districts person been affected by floods.
Other states affected by dense rains see Himachal Pradesh and Jammu & Kashmir successful the northbound of the state and Telangana successful the south.
Excess rains successful August crossed Punjab, Rajasthan and Telangana "are creating a interest for crops astatine their precocious maturation stages," warned S&P Global-backed probe and hazard advisory work steadfast Crisil successful a study connected Saturday.
Benign ostentation truthful acold has allowed India's cardinal slope country to chopped rates, spurring home maturation astatine a clip erstwhile the state faces commercialized worries owed to the U.S. steep 50% tariffs connected its exports.
On Sunday, the Indian Meteorological Department said that conditions are favorable for withdrawal of monsoon from parts of Punjab and different states implicit the adjacent 3 days.
But northeast India and parts of Maharashtra, different important authorities for workplace produce, are expected to spot dense rainfall until Wednesday, IMD said.
"Excess rainfall successful definite parts of the state (particularly Punjab) had caused immoderate worries implicit adjacent word inflationary pressures but all-India regular information connected nutrient items bash not bespeak immoderate large interaction arsenic yet for the period of September," Citi Research said.
Citi had chopped its mean header CPI forecast for India for fiscal twelvemonth ending march 2026 to 2.9% from 3.2% earlier.
"India is witnessing a precise broad-based lowering of inflation," Citi said.
With ostentation expected to stay muted and the authorities focused connected driving maturation to mitigate the interaction of U.S. tariffs, expert expect country for further easing of monetary policy.
"We judge the RBI volition easiness rates erstwhile again successful 4Q25, taking the repo complaint to 5.25%," HSBC said.
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