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Economy

India faces crop worries after driest June in 5 years

Delayed monsoon rains threaten blow to broader economy

MUMBAI (Reuters) -- India had its driest June in five years because monsoon rains were delayed, the weather department said late on Sunday, raising fears for crops and the broader economy.

Overall, the monsoon rains were a third lower than average, though in some states including the sugar cane growing northern state of Uttar Pradesh, they were as much as 61 percent lower, data from the India Meteorological Department (IMD) showed.

About 55% of India's arable land is rain-fed, and agriculture makes up about 15% of Asia's third largest economy, which is already suffering a slowdown.

If the rains don't improve over the next two to three weeks, India could be facing a crisis that hammers harvests and rural demand, analysts said. Companies that sell everything from tractors to fertilisers to consumer goods to farmers would be vulnerable.

Farmers had planted crops on 14.7 million hectares as on June 28, down almost 10% from the previous year, the farm ministry's data showed.

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