An accurate assessment of hydrometeorological variables/ observations over an urban area is crucial to policy-makers and civic bodies to address an extensive range of water resources and environmental problems for informed decision-making related to the water distribution system and drainage networks. This necessitates the establishment of hydrometeorological monitoring networks that can efficiently obtain consistent and reliable information about the spatiotemporal variability of multiple hydrometeorological observations while being economically sustainable. However, the urban catchments especially in underdeveloped and developing countries are often subjected to spatial, environmental as well as monetary limitations which hinders the application of conventional approaches followed to set up the hydrometeorological networks. With this context, we propose a novel rationalization framework to record numerous hydrometeorological variables and acquire maximum information at an optimal cost. We have attempted to combine a multivariate statistical technique, Principal Component Analysis (PCA) with a multi-attribute decision-making method, Technique for Order of Preference by Similarity to Ideal Solutions (TOPSIS) to rank the significant hydrometeorological stations of an existing Automatic Weather Stations (AWS) network. It is observed that the set of rationalized AWS network obtained from this framework can capture the spatiotemporal information of the hydrometeorological variables considered in this study as efficiently as the entire AWS network. Additionally, the comparison of flood inundation and hazard maps derived from a 3-way coupled hydrodynamic flood modeling framework for the rationalized and original network also reflects its credibility to capture the flooding characteristics for the catchment. This proposed framework has been applied over Mumbai city, India, a major flood-prone area, and is characterized by high spatiotemporal variability of hydro-meteorological observations and space constraints due to dense population. This framework is generic and can be employed to reevaluate the prevailing hydro-meteorological networks in other catchments and help in the reduction of the maintenance cost while efficiently capturing the variability of observations.