financetom
Economy
financetom
/
Economy
/
India's agriculture and food inflation face challenges from erratic rains and El Nino
News World Market Environment Technology Personal Finance Politics Retail Business Economy Cryptocurrency Forex Stocks Market Commodities
India's agriculture and food inflation face challenges from erratic rains and El Nino
Jul 11, 2023 2:54 PM

India's agricultural sector, a vital component of its economy, is currently grappling with the impact of uneven rainfall patterns across the country. These weather anomalies, combined with the looming threat of El Nino, have raised apprehensions about agricultural production and food inflation in the country.

Share Market Live

NSE

Ashok Gulati, a distinguished professor at ICRIER (Indian Council for Research on International Economic Relations), highlighted the adverse effects of erratic rainfall distribution on agriculture. He notes that the concentration of excessive rainfall in certain regions, alongside deficiencies in others, presents a worrisome scenario.

The unpredictability of these weather patterns poses challenges to agricultural production, with the extent of the damage yet to be determined. The critical months of July and August will play a decisive role in shaping the outcome for the agricultural sector.

Excess rains in important food grain growing areas, such as Punjab, Haryana, and western Uttar Pradesh, have caused concerns, while 15 rice-growing subdivisions, including Andhra Pradesh, Telangana, Karnataka, and West Bengal, are experiencing deficient rains.

Harish Damodaran, Agriculture Editor at the Indian Express, said in the case of rice, the excess rains in Punjab and Haryana are expected to benefit the crop, as these states are known for their high-yielding agricultural practices.

However, the lack of rainfall in Telangana, Andhra Pradesh, West Bengal, Orissa, Chhattisgarh, Bihar, and Jharkhand raises concerns about potential production shortfalls. The positive outcomes in some regions may not be sufficient to offset the negative effects in rain-deficient areas.

Read Here | Indian cotton exports suffer due to lower yields, declining stock and escalating prices

Regarding flooding, Damodaran suggests that widespread damage to agricultural fields has been relatively limited, mostly confined to low-lying areas. Punjab and Haryana, specifically, have witnessed favorable conditions for transplanting, which bodes well for the overall crop outlook in those regions.

Addressing the broader topic of inflation, Gulati indicates that there may be some control over wheat price inflation. Additionally, he notes that there are fewer buyers in the open market for rice, suggesting that cereal price inflation should not be a major concern for the next few months.

However, Gulati expresses worries about vegetable prices and certain pulses due to the combination of climate issues, floods, and droughts. He specifically highlights the potential for price spikes in tur due to these factors.

Interestingly, he draws attention to a less-discussed aspect, namely milk inflation, which he considers to be a significant concern. "For all the commodities, 299 commodities in CPI basket milk has the highest weight. If you look at the contribution to CPI inflation right now, till last month milk was contributing the maximum and that no one is talking about what is the solution that front."

Follow our live blog for more weather updates

Comments
Welcome to financetom comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
Related Articles >
US Congress scrambles to pass $1.2 trillion spending bill, midnight deadline looms
US Congress scrambles to pass $1.2 trillion spending bill, midnight deadline looms
Mar 22, 2024
WASHINGTON (Reuters) - The Republican-controlled U.S. House of Representatives and Democratic-majority Senate on Friday will scramble to beat a midnight government shutdown deadline by passing a $1.2 trillion bill keeping the government funded through September. If they succeed, it will end a more-than-six-month battle over the scope of Washington's spending for the fiscal year that began Oct. 1. If they...
Fed Chair Powell says pandemic has had lasting effects on economy
Fed Chair Powell says pandemic has had lasting effects on economy
Mar 22, 2024
(Reuters) - Federal Reserve Chair Jerome Powell on Friday opened a Fed Listens event on how Americans are experiencing the economy, saying the pandemic has had lasting effects and that to make good policy the U.S. central bank cannot rely only on macroeconomic data but needs to hear directly from people and businesses. He did not make any remarks about the...
U.S. companies' stock purchases via buybacks, M&A to hit 6-year high in 2024, Goldman says
U.S. companies' stock purchases via buybacks, M&A to hit 6-year high in 2024, Goldman says
Mar 22, 2024
(Reuters) - U.S. companies' purchases of domestic equities through more stock buybacks and corporate acquisitions will hit a six-year high of $625 billion this year, about as much as mutual funds and pension houses will offload, Goldman Sachs said. A surge in share buybacks and continued growth in cash mergers and acquisitions (M&A) will be the primary drivers of corporate...
US Dollar Improves Early Friday Ahead of Fed Appearances, State Unemployment
US Dollar Improves Early Friday Ahead of Fed Appearances, State Unemployment
Mar 22, 2024
07:38 AM EDT, 03/22/2024 (MT Newswires) -- The US dollar rose against its major trading partners early Friday, except for a decline versus the yen, ahead of a series of appearances by Federal Reserve officials that compensate for a lack of major US data. Fed Chairman Jerome Powell is scheduled to make opening remarks at a Fed Listens conference at...
Copyright 2023-2025 - www.financetom.com All Rights Reserved