New Delhi, May 20 -- In the past few days, heavy rainfall has set in over parts of the Bay of Bengal and the Andaman Sea, with the advent of Cyclone Shakti. The India Meteorological Department (IMD) has said this presages the setting in of the southwest monsoon over the Indian subcontinent. It expects rainfall to be 'above normal', at around 105% of the long-run average (in 2024, it was 108%). This has raised hopes on many fronts-from rural demand to corporate performance to rural wages.

Predictions of a good monsoon are always welcomed with a sigh of relief among analysts, policymakers, and businesses. Good monsoons boost agricultural production, leading to a higher increase in agricultural incomes-and, by extension, rural demand. This ...