Mon­soon cru­cial for PM

Financial Chronicle - - FRONT PAGE -

The gov­ern­ment agency said quan­ti­ta­tively the mon­soon sea­sonal rain­fall for June-Septem­ber pe­riod is likely to be 97 per cent of the long pe­riod av­er­age (LPA) with a model er­ror of plus/mi­nus 5 per cent. “It will be a nor­mal mon­soon for the coun­try as a whole,” D Si­vananda Pai, In­dia’s chief mon­soon fore­caster at IMD, told Fi­nan­cial Chron­i­cle. He said this is In­dia’s third con­sec­u­tive year when the IMD pre­dicted nor­mal mon­soon rains for the coun­try.

In fact, Pai said the mon­soon rains would be bet­ter than last year, sig­nalling bright prospect of kharif (sum­mer) and rabi (win­ter) crops across the coun­try, which would in turn in­crease farm in­comes and boost ru­ral econ­omy. Skymet, a pri­vate weather fore­cast­ing agency, also fore­cast a “nor­mal” mon­soon this year ear­lier on April 4. Other than lift­ing farm and wider eco­nomic growth, a wet spell will keep a lid on in­fla­tion, po­ten­tially tempt­ing prime min­is­ter Naren­dra Modi to bring for­ward the gen­eral elec­tions due in May 2019.

THE IMD de­fines nor­mal rain­fall as be­tween 96 per cent and 104 per cent of a 50-year av­er­age of 89 cm for the en­tire four-month sea­son be­gin­ning June. Rains less than 96 per cent are con­sid­ered as “be­low nor­mal” and104-110 per cent of the LPA as “above nor­mal.” Ex­perts said the timely ar­rival of the mon­soon and its dis­tri­bu­tion would play an im­por­tant part so far as the econ­omy was con­cerned.

Mon­soon 2017 was slightly be­low nor­mal for In­dia with the coun­try­wide rain­fall stand­ing at 95 per cent of LPA, which was ac­cu­rately fore­cast by Skymet Weather. IMD’s fore­cast had said it would be 96 per cent of LPA. The mon­soon de­liv­ers about 70 per cent of In­dia’s an­nual rain­fall, crit­i­cal for the farm sec­tor that ac­counts for about 15 per cent of In­dia’s $2 tril­lion econ­omy and em­ploys more than half of the coun­try’s 1.3 bil­lion peo­ple.

In­dia’s 260 mil­lion farm­ers de­pend on mon­soon rains to grow crops such as rice, cane, corn, cot­ton and soy­beans be­cause nearly half of the coun­try’s farm­land lacks ir­ri­ga­tion. The IMD’s fore­cast also sug­gested max­i­mum prob­a­bil­ity for nor­mal mon­soon rain­fall (96-104 per cent of LPA) and low prob­a­bil­ity for de­fi­cient rain­fall dur­ing the four-month sea­son. “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 or nor­mal. The lat­est fore­casts from global models in­di­cate con­di­tions over the Pa­cific will turn neu­tral be­fore the be­gin­ning of mon­soon sea­son, the IMD said.

The nor­mal date for the mon­soon rains to hit the south­ern coast of Ker­ala is June 1. But last year mon­soon rains lashed the Ker­ala coast on May 30.

“IMD’s pre­dic­tion of nor­mal mon­soon should come as a breather for In­dia amid a se­ries of an­gry protests and marches by farm­ers across the coun­try and in the run up cru­cial state elec­tions and gen­eral elec­tion later in 2019,” Pr­erna Sharma, VP and head of agri­cul­ture, food and re­tail, Biz­nomics Con­sult­ing said. The coun­try is go­ing to have three years of nor­mal rain­fall in a row that were needed for strong re­cov­ery of the ru­ral econ­omy af­ter back-to-back drought years in 2014/15 and 2015/16 and de­mon­eti­sa­tion jolt in Novem­ber 2016, she pointed out. “The an­tic­i­pa­tion of favourable mon­soon rain­falls will bring more ar­eas under khar­iff cul­ti­va­tion and bet­ter yields for crops like paddy, soy­bean, cot­ton and maize sub­ject to dis­tri­bu­tion and tim­ing of rain­fall,” Sharma said.

How­ever, good mon­soon and re­sul­tant in­creased out­put may fur­ther de­press the farm pro­duce prices when the world is flooded with the ex­cess sup­ply of most agri­cul­tural com­modi­ties and hence ex­port prospects re­main bleak, she pointed out.

“This will thus ag­gra­vate the eco­nomic con­di­tion of al­ready distressed farm­ing house­holds… though likely in­creased out­put is good for in­fla­tion man­age­ment. How­ever, it may cre­ate po­lit­i­cal com­pli­ca­tions for Modi gov­ern­ment,” Sharma said.

Ac­cord­ing to Madan Sab­navis, chief econ­o­mist at CARE Rat­ings, nor­mal mon­soon is good for the kharif crop, which ac­counts for about 50 per cent of farm pro­duc­tion while around 65 per cent of the pro­duc­tion is rain de­pen­dent. The north­ern states have ac­cess to ir­ri­ga­tion and hence crops like rice are well pro­tected to an ex­tent, he said.

Sab­navis said the spa­tial dis­tri­bu­tion of the rains is im­por­tant as it de­ter­mines the avail­abil­ity of wa­ter for spe­cific crops. “Crops such as cot­ton, oilseeds and pulses are de­pen­dent on mon­soon in penin­su­lar In­dia cov­er­ing states like Ma­ha­rash­tra, Te­len­gana, AP, TN and Kar­nataka.” he pointed out.

Newspapers in English

Newspapers from India

© PressReader. All rights reserved.