Mumbai, June 29 -- El Niño, a climate pattern marked by unusually warm ocean temperatures in the central and eastern Pacific, often leads to a weaker or erratic monsoon in India. Since agriculture remains a key driver of the Indian economy, rainfall disruption can set off a chain reaction-from lower farm output and higher food prices to inflationary pressures-that can ultimately affect household finances.

A weak monsoon does not cause financial damage overnight, but it unfolds over several months. Madan Sabnavis, chief economist at Bank of Baroda, highlighted that timing and geography drive the initial economic shock.

"The possibility of El Niño is very high in July-August. This will mean possibly lower rainfall in some parts....