India’s economic recovery, now in its fourth year, continues to show momentum, although some indicators are softening. The agriculture and services sectors performed well, bolstered by above-normal monsoons and adequate reservoir levels. This helped drive kharif sowing above last year’s levels and the five-year average. While manufacturing momentum softened slightly, RBI surveys indicate improved business expectations for the coming quarters. Heavy monsoon rains moderated mining, construction, and road transport services, but overall business sentiment remains positive. Rural demand is strengthening, reflected in rising FMCG volume sales and increases in three-wheeler and tractor sales. However, urban demand has moderated due to softening consumer sentiments, higher rainfall, and seasonal purchasing trends.
