The Hindu Business Line : Good rain!

Despite a hesitant start, the South-West monsoon’s progress is a good augury for the country’s beleaguered farm sector. As of end-June, 30 of the 36 meteorological sub-divisions recorded excess to normal rainfall. The whole of southern, western and most parts of central India have received satisfactory precipitation. Time and conditions are propitious for an intensive campaign to augment the output of Kharif crops that include fine cereals (rice), coarse grains (maize, sorghum), oilseeds (groundnut, soyabean), cotton and pulses. On current reckoning, the prospects for rainfall in July — the month of maximum precipitation in the four-month cycle — look bright.

The next harvest is still a good three months away and the challenge for the Government till then would be to ensure uninterrupted supplies of essential food commodities such as wheat, pulses and edible oils, and checking undue price rise. August to October is when demand for essential food items expands manifold because of a series of festivals. This is also the period when speculators usually have a free run to make windfall gains from demand-supply mismatches. The focus on supply management must continue. The momentum of falling inflation rates in recent weeks should not be allowed to reverse.

Notwithstanding official inflation numbers, high food prices continue to burn a hole in the poor man’s pocket. Augmenting essential food supplies through the Public Distribution System and implementing welfare programmes more vigorously should receive focused attention. A good Kharif harvest is sure to bring considerable relief to almost everyone including the Centre that has been under considerable pressure for almost a year now. A robust farm output growth will at once translate to higher demand for all goods and services. However, what is of concern is that farm growth targets are rather low vis-À-vis the magnitude of the demand or the shortage. For instance, the envisaged foodgrains output growth rate is 2.3 per cen t and for oilseeds 4.0 per cent. There is no guarantee that even these modest growth rates will be achieved.

The agricultural sector is languishing in the absence of a strategic plan and commitment. In the event, shortages and, in turn, import dependence will continue to persist. Whether edible oils or grains, global food prices are unlikely to soften markedly anytime soon. The rising tide of biofuel demand will keep prices firm. Therefore, a good deal of planning is necessary to arrange for timely imports. The Centre failed to acquit itself satisfactorily in the matter of wheat imports. Together with pulses, edible oils should be imported at zero-duty and supplied through the PDS to benefit poor consumers.

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