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G. Chandrashekhar

MUMBAI, Dec. 26

EVEN by October when the condition of drought-ravaged kharif crops was known, there was enough indication of things to follow - a poor rabi season crop, in the wake of inadequate soil moisture in major parts of northern India.

Evidence of lower acreage in a number of summer season crops is now available. The Ministry of Agriculture has admitted to a decline of about three million hectares under wheat in Madhya Pradesh and Rajasthan together. Even Uttar Pradesh will see a decline in area sown to wheat.

Compounding the problem of lower acreage is unfavourable weather. Temperatures are abnormally high, raising fears of lower yield. Wheat output can potentially plunge to a six-year low of about 65 million tonnes, down from 72 mt of last year.

Reports from different regions indicate that conditions of other crops such as oilseeds and pulses are not encouraging either. A major setback to rapeseed/mustard production is expected. A very preliminary estimate of crop size is 39 lakh tonnes, down from last year's 52 lt .

Planting in major growing States such as Rajasthan and Uttar Pradesh has been on a lower scale because of unfavourable conditions. Some experts believe, the output could plunge even lower to around 35 lt.

A small increment in summer oilseeds output can be had from the southern region where following widespread rains in October-November, prospects of both groundnut and sunflowerseed have improved. But even that cannot prevent a setback to 2002-03 oilseeds production which is set to reach a new recent low of 160-165 lt .

In three out of four years since 1999-2000, oilseeds output has fallen below 200 lt mark. When contrasted with the annual production target of 280 lt, the scale of decline and consequent problems become stark.

The fate of pulses is no different. 60 per cent of annual pulses output comes from the summer season. This year, growing conditions are far from satisfactory. Reports from different regions indicate a lower acreage of anything between 10 and 20 per cent. Even during best of times, pulses output has been sluggish and the country is forced to resort to large-scale imports.

Thus 2002-03 could turn out to be the worst year in recent memory for the country's agricultural output. The Agriculture Ministry has already admitted to a decline of 20 mt in foodgrains output in the kharif season comprising 12.5 mt of rice and 7.5 mt of coarse cereals.

Now, wheat output is slated to fall by 6-7 mt. Together with imminent decline in pulses production, foodgrains production decline in 2002-03 can aggregate 30 mt In 2001-02, foodgrains production reached a new high of 211 mt.

A steep fall in foodgrains output (30 mt) together with fall in oilseeds (4 mt), sugarcane (16 mt) and cotton (2.6 million bales) production, not to speak of loss of other crops such as fruits and vegetables, will mean a significant drop in growth in agriculture this year. Last year. GDP growth in agriculture was 5.7 per cent.

Even the mid-year review report of the Government issued recently has been cautious, without of course being alarmist. The report says, ''If the agricultural sector turns out to be more resilient than what was initially apprehended and the decline in foodgrains production is limited to around 10 million tonnes, the overall GDP growth in agriculture, forestry and fisheries could drop to about one per cent during the current year from the high of 5.7 per cent recorded in 2001-02''.

It is important to note the cautious language in which the report is couched. The anticipated one per cent growth in agriculture is almost entirely dependent on foodgrains production decline being limited to 10 mt.

The report goes on to state: ``With a net positive growth of one per cent of the agriculture and allied sector, the overall GDP growth in the current year may be close to the 5.5 per cent projected by the Reserve Bank of India''. If reports of Rabi crops conditions from across the country are any indication, it would be wishful thinking that the fall in foodgrains production will be limited to 10 mt in 2002-03. If anything, production prospects have actually worsened as shown above and the actual decline may be around 30 mt.

There is thus no way the contribution of agriculture to overall GDP growth can be positive this year. No doubt, large buffer stocks of rice and wheat are a source of strength; but the strength has to be effectively leveraged. How the Government effectively deploys the inventory to contain price rise and ensure a fair and equitable distribution across the country in 2003 remains to be seen.

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