The flooding, described by officials as the worst in many decades in south India, has killed some 250 people, mostly in the states of Karnataka and Andhra Pradesh. At least five million people are crammed in temporary government shelters.
Flood waters swamped millions of acres of cropland, including sugarcane plantations, prompting worries of a fall in sugar output in Karnataka, the country's third-biggest producer.
Traders also estimated the flooding would hit corn output by at least one million tonnes in Karnataka and Andhra Pradesh, which account for about 35 percent of India's total corn production.
Officials said 300,000 heavy sandbags were being used to fortify weakening embankments of the Krishna river that flows close to Vijayawada, a city of about a million people in Andhra Pradesh and an important trading center.
Rescue workers also moved more than 200,000 people living close to the river. An alert had been sounded in about 100 villages situated along the Krishna.
"These are the worst floods in 100 years," said Dharmana Prasada Rao, Andhra Pradesh's minister for revenue and relief.
Relief officials used helicopters and boats to drop off rations and plastic sheets to hundreds of marooned villagers in Andhra Pradesh and Karnataka.
Officials and relief agencies said flood victims were now sheltered in over 1,200 temporary camps. They included about 2.5 million people from Karnataka and Andhra Pradesh who have lost their homes.
H.V. Parashwanath, a Karnataka disaster management official overseeing relief operations, told Reuters that some two million people had been made homeless in the state.
Sonia Gandhi, the head of India's ruling Congress party, and federal Home Minister Palaniappan Chidambaram inspected the devastation.
Officials said vast areas of agricultural land, including sugarcane and paddy fields, were under water in the state.
"About two-thirds of the 54 sugar mills in the state have been forced to delay crushing by a week to 10 days as cane fields are submerged," Govind Reddy, a secretary of the Southern Indian Sugar Mills Association, told Reuters over the phone from Bangalore, the capital of Karnataka.
(Additional reporting by Habib Beary in BANGALORE; Writing by Krittivas Mukherjee; Editing by Sugita Katyal)