The agricultural Gross Value Added (GVA) growth is expected to moderate to 4.5% in the first quarter of FY26, down from 5.4% in the preceding quarter, according to a report by ratings agency ICRA. The agency attributed the likely deceleration to mixed sowing patterns across major crops, even as it maintained a broadly robust outlook for the sector.A slowdown in Agri-GVA expansion impacts rural incomes and consumption, with implications for overall economic momentum. However, steady output from rabi and most summer crops continues to support the underlying farm sector, the report noted, as reported ANI.For the full financial year FY26, ICRA projected agricultural GVA growth to ease to 3.5–4.0%, compared with the provisional 4.6% growth recorded in FY25. The agency assumed a reasonably healthy Kharif season to support this forecast.Citing crop-specific developments, ICRA said sowing of moong, rice, and maize recorded healthy growth, while arhar, urad and soybean remained below year-ago levels. As of July 25, the area sown under pulses was at 72% of the normal area, compared with 69% during the same period last year — up 3.5% year-on-year, led by a 16.1% increase in moong sowing. In contrast, arhar and urad witnessed declines of 8.1% and 6.7% respectively.The acreage under oilseeds fell by 2.2% YoY, dragged by contractions in sunflower (-5.1%), soybean (-3.8%) and niger (-86.4%), with groundnut showing only muted growth at 1%.Rainfall patterns will be crucial in determining crop output, ICRA said. The India Meteorological Department (IMD) has predicted above-normal rainfall for August–September 2025, and the neutral El Nino conditions are also expected to aid sowing. However, the distribution of rainfall remains a key variable.India received 105% of the long-period average (LPA) rainfall in July 2025, slightly below the IMD’s forecast of over 106%. While rainfall was strong during July 1–15 (11% above LPA), the second half of the month saw a decline, recording 0.5% below LPA — a shift that could weigh on kharif prospects.The monsoon began with a delay and a sluggish early June, with cumulative rainfall at just 69% of LPA by June 15. However, conditions improved in the latter half of June, with precipitation surging to 133% of LPA between June 16 and 30, partially offsetting the earlier shortfall.
