An economist said the near normal rainfall will give a big boost to overall economic growth, which had sagged because of last year's dry spell which sapped the vital agricultural sector.

"Monsoon rains for the country are likely to be 98 percent of the average," the meteorological department said in a statement.

It said the monsoon in July, the most important period for harvesting, was likely to be at 102 percent of the seasonal average.

The department said that although the monsoon had begun in southern India on June 8 a week after the normal date, the rains had been bountiful all over the country.

"Many parts of the country received good pre-monsoon showers, which provided relief from the prevailing water stress situation. The monsoon covered the entire country on July 5," the statement said.

It added that rainfall between June 1 to July 2 was six percent above the seasonal average.

A severe drought last year hit the country's agriculture sector hard, slowing India's economic growth down to 4.3 percent from 5.7 percent the previous fiscal year.

Seventeen of India's 29 states experienced a drought in June and July 2002, including the country's breadbasket northern states.

T.K. Bhowmick, an economist at the Confederation of Indian Industry, the country's leading trade lobby group, said the healthy rainfall will bring an all-around positive impact to the economy.

"This year will be great for the Indian economy. We are going to see a record bumper harvest if the trend continues and will hopefully get six percent growth in agriculture," he added.

"Overall, the economy is likely to grow by more than 6.5 percent."

India's agricultural sector logged a negative 3.2 percent growth last year because of the drought. Agriculture contributes 25 percent to the gross domestic product and employs 70 percent of India's one billion-plus population.

An estimated 300 million people were directly affected by the dry spell.

However, the low growth in agriculture last year was to an extent offset by over five percent growth in the manufacturing, mining and hotel industries.

Bhowmick said the monsoon rainfall was also bound to stimulate industrial growth, which has been rising in the last eight to nine months.

"Industrial growth is likely to be around 6.5 to 7.0 percent because we are likely to experience an impact of monsoon on the industry late in the year," he said.

He explained that the time lag was because farmers tend to buy more goods only after the harvest has been reaped.

TERRA.WIRE