The rainfall deficit and uneven distribution have led to severe drought conditions in certain regions, directly affecting agricultural productivity. This is likely to result in increased food inflation, with estimates suggesting a rise of 1.0 percentage point in a central scenario and up to 3.0 percentage points in a severe drought scenario. The situation poses risks to farmers, rural livelihoods, and the broader economy, as food prices are a significant component of inflation in India. Additionally, the drought could strain water resources and exacerbate socio-economic challenges in affected areas.