Low agriculture production could dampen Indias growth story

Recent drought resulting in poor kharif crop production may lead to the farm sectors growth slide by about 3 per cent this fiscal...

Recent drought resulting in poor kharif crop production may lead to the farm sectors growth slide by about 3 per cent this fiscal,Planning Commission Member Abhijit Sen said today. Initially I felt that the agriculture growth may by 6 per cent,but now I think that the sectors growth could be less by 3 per cent or even less this fiscal. However,owing to the recent drought,Kharif crop and horticulture crop production slid by 12-17 per cent, Sen said.

He exuded confidence that the Rabi crop output as of now looked good. Rabi crop output currently looks pretty okay. So I would not be surprised if we could contain the drop, he said. The agriculture output in fiscal 2008-09 was at 1.6 per cent. It stood at 4.9 per cent during 2007-08 fiscal.

The countrys shief statistician Pronab Sen too today opined that economic growth rate could decline to 6 to 6.5 per cent in the third quarter of this financial year owing to the impact of drought and floods on the agriculture sector. It (Q3 GDP) could be 6 to 6.5 per cent. Q3 growth rate is expected to be quite significantly lower than Q2. As per the latest update,the farm production is likely to dip by 6 to 7 per cent during the third quarter , Sen reasoned,while pointing out that the impact of the monsoon failure and floods in different parts of the country would be reflected in the growth rate for the third quarter.

On concerns over agriculture minister Sharad Pawars assertions that the North India was facing supply side constraint on milk,Abhijit Sen said the nations rate of production was not as high as it should be and there was a need to make efforts to take milk production to a level where it should be. We should be aware that if likely large shortages are likely to come up in the near future then a certain amount of management is required,which has to be forward looking, Sen argued. Meanwhile,Pawar today said the Centre was not considering any proposal to hike milk prices. His had earlier reasoned that states needed to decide on the demand for hiking milk prices,which triggered angry reactions from political parties protesting food inflation rising close to 17 per cent.