<p>The interannual variability of All India Monsoon Rainfall (AIMR) is of paramount importance for the country’s socioeconomics. The government classifies years with AIMR above 110% of mean seasonal rainfall as surplus, below 90% as deficit and normal otherwise, which underlie critical decisions. However, all India averaging may result in a monsoon being declared surplus in a year even when different subregions experience a deficit and vice versa. The presence of negative covariance among different regions affects the interannual variability of AIMR. An analysis of 40 years of gridded monsoon rainfall data reveals that the negative covariance between the Northeast India (NE) and the other regions of India, particularly Central India (CI), controls the interannual variability of AIMR and reduces the total coefficient of variation (COV) by 2.15%. To understand the role of moisture sources in the negative covariance, utilising Lagrangian backtracking for moisture in a reanalysis data, we found that during CI’s deficit rainfall years, NE experiences a surplus rainfall with 61.69% of the surplus contributed by terrestrial sources. In CI’s surplus years, a significant fraction of the moisture supply from the ocean is -confined to CI, resulting in NE facing deficit rainfall. In CI surplus years, trajectories towards NE align with the southwesterly jet, while CI deficit years show increased flow over land from northwest India and the Himalayan foothills, especially in June and September. Our findings emphasise the important contributions of terrestrial moisture sources to the interannual variability of AIMR and caution against relying on AIMR for scientific studies and the long- and short-term planning at regional scales in India.</p>