The monsoon deficit has adversely affected key agricultural regions, particularly in Karnataka, Maharashtra, Andhra Pradesh, Telangana, and Rajasthan. Reservoir storage levels in southern states are significantly below average, threatening irrigation for rabi crops like rice, wheat, and pulses. The uneven rainfall has also led to crop stress, with kharif sowing down by 1.2% compared to last year. This could exacerbate food inflation, especially for pulses and oilseeds, and weaken rural incomes, potentially dampening rural demand in the second half of FY27.