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Amid apprehensions of a drought for the second successive year, Finance Minister Arun Jaitley sought to allay fears over the weatherman’s forecast of a deficient monsoon.
On Tuesday, the India Meteorological Department (IMD) had lowered its monsoon forecast to ‘deficient’ from ‘below normal’. This created a fear about a surge in prices and also caused large-scale selling in the stock market, which has slumped by over 1,000 points in the last three trading sessions.
“…to draw a conclusion on that basis of either inflation or some kind of distress situation is far fetched. I don’t anticipate any situation of this kind, even with the kind of (monsoon) prediction which has been made,” Jaitley told newspersons here.
The Finance Minister said he had detailed discussions with senior IMD scientists on Wednesday. “Their advance predictions appear to suggest that we will be somewhat closer to the normal in the South, Central and North-East zones. The slight inadequacy, if at all, is in the North-West and a large part of the North-West has substantial irrigation facilities also,” he said.
Enough stocksEven assuming that the advance predictions are correct, he said, on account of geographical distribution, the impact on foodgrains production may not be very significant. Also, the country has enough foodgrain stocks to meet any contingency.
“The kind of speculation that we have been seeing and speculative analysis that we have been reading about appears to be somewhat misplaced,” he added.
The Minister further said that food management was the responsibility of the government and buffer stocks will be used to keep prices in check.
‘Market fall not a trend’
“A day or two of reaction in the market … never indicates a trend,” Jaitley said, dismissing the negative mood. He also listed various positives, such as growth numbers, the surge in indirect tax collection and increase in public expenditure.
“In the last few months — and I have been getting bank-wise data also — many stalled projects have started. There is a downward movement in bank NPAs and, therefore, coupled with these trends, I foresee the recovery trend in the economy continuing,” he said.
Jaitley also made it clear that the “disinvestment programme of the Government will continue as planned.”
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