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UPDATE 2-India set to receive average monsoon rains, in boost for poll-bound Modi

* Monsoon rains seen at 97 percent of a long-term average

* Low probability of a deficit monsoon - weather office
chief

* Weather office to issue updated monsoon forecast in early
June
(Adds quotes, background)

By Sudarshan Varadhan and Mayank Bhardwaj

NEW DELHI, April 16 (Reuters) - India is likely to receive
average monsoon rains in 2018, the weather office said, raising
the possibility of higher farm and economic growth in Asia's
third-biggest economy, where half of the farmland lacks
irrigation.

Monsoon rains, the lifeblood of the country's $2 trillion
economy, are expected to be 97 percent of a long-term average,
K.J. Ramesh, director general of the state-run India
Meteorological Department (IMD), told a news conference.

"We see very less probability of a deficit monsoon," Ramesh
said on Monday.

Other than lifting farm and wider economic growth, a spell
of good rains will keep a lid on inflation, potentially tempting
Prime Minister Narendra Modi to bring forward general elections
due in May 2019.

India's weather office defines average, or normal, rainfall
as between 96 percent and 104 percent of a 50-year average of 89
cms for the entire four-month season beginning June.

"The moderate La Nina conditions developed in the equatorial
Pacific during last year started weakening in the early part of
this year and currently have turned to weak La Nina conditions,"
IMD said in a statement.

La Nina is a weather pattern that brings equatorial Pacific
Ocean temperatures, rainfall patterns and winds closer to
average.

The latest forecasts from global models indicate conditions
over the Pacific will turn neutral before the beginning of
monsoon season, the IMD said.

Good rains will spur the planting of crops such as rice,
corn, cotton and soybeans, accelerating economic growth that
rose 7.2 percent in the December quarter, its fastest in five
quarters, compared with China's 6.8 percent in that quarter.

Growth in the December quarter restored India's status as
the world's fastest growing major economy.

RURAL INCOME

Average monsoon rains, with good distribution in July and
August would support rural demand, said Rupa Rege Nitsure, group
chief economist at L&T Finance Holdings, a Mumbai-based
non-banking finance company.

Good rains boost rural incomes, lifting the demand for an
array of consumer goods ranging from lipsticks to refrigerators.

An average monsoon would keep food inflation lower, Nitsure
said.

On Monday, government data showed India's wholesale food
prices fell 0.07 percent in March 2018 from a year earlier.

India's weather office will update its forecast in June.

On an average, the IMD has forecast accurately only once in
every five years over the past two decades, even after taking
into account an error band of plus or minus 5 percentage points.

Rains usually lash Kerala state on the south coast around
June 1, and cover the whole country by mid-July. Timely rains
trigger planting of crops such as rice, soybeans and cotton.

The monsoon usually covers the half of the country in the
first 15 days. The rains reach central India's soybean areas by
the third week of June and western cotton-growing areas by the
first week of July.

Good rains would help boost soybean output which in turn
could cut expensive vegetable oil imports by India, the world's
biggest importer of edible oils, which is the third-biggest
import item after crude oil and gold.

Currently India is struggling with huge amounts of sugar
and good rains could further bump up the supply of the
sweetener.

"A good monsoon will help bring down edible oil imports, but
it could also create a problem of plenty in pulses and sugar,"
said a Mumbai-based dealer with a global trading firm.

Average monsoon rainfall will help India retain its position
as the world's top rice exporter.

(Reporting by Sudarshan Varadhan and Mayank Bhardwaj;
Additional reporting by Rajendra Jadhav and Suvashree Choudhury
in MUMBAI and Manoj Kumar in NEW DELHI; Editing by Malini Menon
and David Evans)

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