Industry worried over monsoon forecast

Key sectors of the economy are keenly watching the monsoon’s progress as it enters a crucial phase this week.

According to oilseeds crushers, rain this week will be crucial for kharif crops. However, the India Meteorological Department has disappointment in store. It has forecast a dry week.

Though weather models project a “near normal to below normal” monsoon this year, most of them agree that the north-western parts, comprising Rajasthan, Punjab and Haryana, could end up receiving deficient rainfall. Punjab and Haryana hold the key to a good kharif crop.

Looking at the unfolding scenario, the Centre has prepared a contingency plan for seven States where a drought-like situation prevails. The crop protection sector is already going through a troubled phase with demand falling. Rising dollar and yuan have compounded its problems and the situation is likely to be ‘alarming’.

The fast moving consumer goods sector seems to have anticipated the grim situation. As a result, consumers may not have to shell out more for soaps, detergents, shampoos and hair oils.

The sector, however, is preparing to introduce new products.

The white goods sector too sees gloom. Despite that, the manufacturers are coming up with new schemes to keep the show going.

The automobiles industry is on a “wait and watch mode”.

While on the one hand, manufacturers are wary that sales of two-wheelers, commercial vehicles and tractors could be hit, , labour shortage, on the other hand, could, in fact, push up farm implement sales.

A poor monsoon need not necessarily mean a surge in inflation.

A study of past trends has thrown up interesting facts that deficient rain has not led to sky-rocketing prices.

Bankers feel it is too early to take a call and are keeping their fingers crossed.

They are banking on the credit absorption capacity of farmers improving so that they can meet the farm loan disbursement target set by the Centre.

For more stories see >MONSOON WATCH

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