Robust procurement of paddy and wheat since 2017 and prompt payment to farmers have helped the UP government cultivate a positive and pro-farmer perception, defusing possible farm face-off situations.
Softening inflation, Das said would make available more policy space to the central bank to address risks to the growth going forward.
The output of pulses and oilseeds in 2012-2013 is likely to fall by 14.61 per cent and 9.62 per cent, respectively, says the first official estimate of kharif season. Experts warn this could trigger a spike in food prices.
The Reserve Bank on Friday retained the GDP forecast for the current financial year at 9.5 per cent and flagged global semiconductor shortages, elevated commodity prices and potential global financial market volatility as downside risks to economic growth. In his address after the three-day meeting of the rate-setting panel, RBI Governor Shaktikanta Das said recovery in aggregate demand gathered pace in August-September, and it is reflected in high-frequency indicators, like railway freight traffic; port cargo; cement production; electricity demand; e-way bills; GST and toll collections. "The ebbing of infections, together with improving consumer confidence, has been supporting private consumption," he said, and added the pent-up demand and the festival season should give further fillip to urban demand in the second half of the financial year.
After unseasonal rains, supply disruptions and pandemic-induced woes pushed retail inflation well over the Reserve Bank's comfort zone in 2020, the scenario is likely to stay that way at least in the short term as economic recovery slowly gains foothold. For most part of this year, pricier food items pushed the retail inflation, based on Consumer Price Index (CPI), higher in the range of 6.58-7.61 per cent, except for March when the reading was 5.91 per cent. Experts believe retail inflation is likely to average around 6.3 per cent this fiscal and mostly will remain sticky going forward owing to pick-up in demand across sectors.
A likely western disturbance over north India during the weekend might cause heavy to very heavy showers in a few places, including New Delhi.
Amid fears of a third wave of coronavirus pandemic and hardening of retail inflation, the Reserve Bank is likely to maintain status quo on interest rate and watch the developing macroeconomic situation for some more time before taking any decisive action on monetary policy. The RBI is scheduled to announce its bi-monthly monetary policy review on August 6 at the end of the three-day meeting -- August 4-6 -- of the Monetary Policy Committee (MPC). The RBI Governor-headed six-member MPC decides on the key policy rates.
Agriculturally important UP, MP, Haryana, Maharashtra, and Punjab received 20-30% shortfall in rain
Referring to visible indicators of green shoots, the finance minister said the forex reserve is at an all time high and the stock market is upbeat.
India consumes around 24-25 million tonnes of pulses, but sowing trends show this year production is expected to be lower compared to last year.
These three states sought a combined financial assistance of Rs 11,186 crore
India exports about 1.5 mt of onion every year.
Monsoon in August was almost 24 per cent below normal, which was the sixth driest August since 1901. It came on the back of a 7-per cent monsoon shortfall in July.
Uttar Pradesh, Bihar, Jharkhand, Odisha and Gujarat, have been left out, despite a strong start to the monsoon in June
'The spirit of cooperation between the Centre and states has been diluted in many ways.' 'The level of consultation which used to be there earlier has reduced significantly.'
Keeping the employment rate from slipping is challenging. To merely keep the employment rate unchanged, the economy has to generate additional jobs. It needs to run to stay where it is, points out Mahesh Vyas.
In Delhi, the wholesale price is now Rs 48-52 a kg; the retail one is Rs 80 a kg.
Rising commodity costs, coupled with other marketing-related expenses, could weigh on profitability in the coming quarters.
This year's kharif output may be higher than last year but it will be short of 2007 or 2008 levels.
Currently, the retail inflation is well below the RBI's comfort level. The government has asked the central bank to keep inflation in the range of 4 per cent.
In the context of RBI's view that the real interest rate, defined as the repo rate less "look forward" CPI, should be around 150-200 basis points.
The government on Monday exempted importers of pulses from stock limits, and also relaxed the norms for millers and wholesalers, in view of softening of prices of the key pulses in the country. Now, the stock limits will be applicable only on tur, urad, gram and masoor for a period up to October 31, it said. However, these entities will continue to declare their stocks on the web portal of the Department of Consumer Affairs, it added. A revised order in this regard has been notified.
Low rain coupled with the fact that maize prices in the open market have surged from around Rs 15-16 a kg to almost Rs 25 this year have forced farmers to turn to this crop.
For July-September, it pegged CPI-based retail inflation at 4.2 per cent which it saw firming up to 4.8 per cent in the second half of the current fiscal.
On a day when several mandis across the country are closed in protest against the recent Centre's decision to impose stringent stock-holding limit on pulses, the government clarified that limits have been defined as retail prices are still higher than last year though there is some moderation in the last few weeks. It said the same logic also holds true for edible oils, the import duties on which was slashed few days back and curbs lifted on import of refined oils. The decision on edible oil and pulses have caused massive resentment among the trading community as it came just ahead of the kharif sowing season, when prices were off their peaks due to multiple steps announced previously. Sources said trading activity in some of the major mandis dealing in pulses such as Sholapur, Amravati and Latur in Maharashtra, Indore and Dewas in Madhya Pradesh along with Kanpur in Uttar Pradesh was impacted as traders went on a flash strike in protest against the decision to impose stock limits.
A favourable monsoon and government support to the rural economy are among the reasons that agrochemical companies, including makers of pesticides and fertilisers, have done well.
Sanjiv Mehta, chairman of the country's largest consumer goods company, HUL, believes that the second wave of the Covid-19 pandemic between April and June this year has been a mere pause in India's consumption story, and that it will not change the country's overall growth trajectory. India is poised for growth, especially in the fast-moving consumer goods (FMCG) sector, Mehta told shareholders at the company's annual general meeting on Tuesday. The signs of recovery are becoming evident with many states lifting lockdown restrictions in recent weeks.
The NITI Aayog, in a concept note floated a few months back, had suggested three models of procurement but the Centre, at least for the time being, has decided to rely on existing PSS schemes along with giving states the option of choosing Bhawantar Bhugtan for oilseeds.
With social distancing in customer's mind coupled with the government's push to further normalise business conditions and banks becoming more considerate to finance vehicles, entry level passenger vehicles saw good demand.
If the quantity purchased from anywhere in the country exceeds 25,000 tonnes, the central government will also have to be informed in writing.
Owing to erratic monsoons this year, the kharif grain output is projected to fall 18 per cent to a seven-year low of 96.63 million tonnes against last year's 117.70 million tonnes.
The Reserve Bank on Friday said the agriculture growth will be muted this fiscal on account of the impact of poor monsoon on kharif crops.
Much of the rural recovery story is based on the premise of agriculture doing well. Even if it clocks a growth of 2.5-3 per cent this year, it is still just around 15 per cent of the overall GDP. The non-farm sector, which constitutes a bigger portion of the overall rural economy, is now hampered by disruptions and lockdowns.
The Bharatiya Janata Party-led state government is acquiring groundnut at Rs 4,500 per quintal; the market price is Rs 3,500 per quintal
NITI Aayog has been working on an action plan to relieve rural distress and energise the agricultural sector
The India Pulses and Grains Association estimates production of kharif pulses at seven mt this year.
The final agriculture GDP numbers for 2016-17 are expected to be revised up, as rabi production is looking really good.
Farmers have either dropped or delayed sowing of summer crops due to poor rains.
Skymet is credited with correctly predicting the 2009 drought.
In the coming four months from August, agitating farmers will hold 400 meetings across the country to highlight farmers' issues and protest against government claims, reports Sanjeeb Mukherjee.
