India: Insufficient rains could lower agriculture output

By APD Writer Rishika Chauhan

NEW DELHI, September 16 (APD)-- With a 40% drop in monsoon rains this year, experts suspect a fall in food crop output in the country.

According to experts, the fall in food crops will affect rural demand, which could lead to inflation. The India Meteorological Department said on Friday that monsoon rains were normal in only 44% of the country.

Provinces of Punjab, Haryana, Uttar Pradesh and Madhya Pradesh, which produce most of the food crops in the country, are suspected to be in a drought-like situation after the end of monsoons.

The Agriculture Ministry’s data shows a 2.5 million hectare decrease in the area sown with rice, pulses, coarse cereals and oilseeds.

However, since the provinces of Punjab and Haryana possess facilities for artificial irrigation, the output could be stabilized, though the cost of production would increase, causing worries of inflation.

India’s economic growth fell to 5.7% in the first quarter of this year compared to 7.9% in the same quarter last year.

Currently, the Reserve Bank of India (RBI) has estimated inflation to be 3.2%, which is the highest in the past four months. A further increase in inflation will discourage the RBI from lowering interest rates, which is important to stimulate spending.

(ASIA PACIFIC DAILY)