HSBC ON RURAL INDIA ; STEADY DEMAND, BUT RAINFALL DEFICIT RAISES H2 FY27 CONCERNS

• Rural demand remains steady, with most companies maintaining a neutral to optimistic outlook. • 2026 marks the driest year in five years, with 44% of districts reporting deficient rainfall. • Reservoir levels are 18% below the 10-year average, with South India worst affected at 46% below average. • Higher crop prices support affluent farmers but put pressure on landless workers and lower-income households. • Risks to the Rabi crop could weigh on rural consumption and demand recovery during H2 FY27.

← Back to feed