The Indian economy continues to be the second fastest growing economy in the world, only after China, thanks to the high domestic demand. It is important to note that India depends on agriculture for over 40% of the GDP.
Also over 50% of the population depend on agriculture for their livelihood.
The monsoon season started six weeks back, and as of two days back, the monsoon is deficient by a massive 25% at the country level. In many key states it is deficient by over 35%. Some states have already declared drought, while many are expected to follow suit.
Already there is a big spike in food article prices over the last four weeks, with some pulses and sugar prices shooting up by over 50% year on year. As per latest review by the IMD, the Indian weather forecasting department, the immediate prospects in the next two weeks are also bleak.
All these put together we can expect a big crash in the Indian GDP in the coming months. So investors are advised to stay away from investing their money in Indian markets for the time being, till the weather situation improves.