India’s finance minister Pranab Mukherjee said on Wednesday that on account of poor rains this season, the food grain output in the country would decline at least by 15 million tonne. “There will be a (harvest) shortage of 14 to 15 MT as per estimates arrived at in a meeting chaired by me,’ said the FM. It would also lead to substantial impact on farm income and hence rural consumption with possible implications for indian economic recovery.
The minister however said that government was in a position to mitigate the ill impacts of the development. He said that the government would provide an additional 50-60 days work over and above the 100 days under the national rural employment guarantee scheme (NREGA) in the areas affected badly by poor monsoon so that the negative impact on farm income could be contained.
The minister also said that late rains had helped to lower the potential damage of weak monsoon and the water level in major reservoirs had reached 82% or just 5% less than normal. This, Mr. Mukherjee said, would help keep the hydel power projects in business and would also help irrigation facilities for the winter crop.
India’s southwest monsoon has been nearly 20% below the long period average this season which has resulted in 15-20% less sowing in the kharif (summer) season crop. According to the estimates by the planning commission, in the best case scenario, farm output over the fiscal was expected to come down by 2.5%, a figure that can go up to 6.0% if the worst case scenario prevails.