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India Worries Monsoon Will be Late
Amid a gloomy economic outlook as growth in Asia's third-largest economy skids to a nine-year low of 5.3 percent and with inflation rising to nearly 7.6 percent in May, India’s interest in the annual monsoon is bordering on paranoia.
The Indian Meteorological Department predicted that the monsoon would set in over southern Kerala on June 1, give or take four days. But with the rains still lagging in most parts of the country nearly at the end of June, alarm bells have started pealing.
Although agriculture's share of India's gross domestic product has fallen from 25 percent in 2002 to the current 17 percent, India’s US$2 trillion-economy is still largely agrarian, with 70 percent of the population engaged in agriculture and dependent on the amount of monsoon rains as a large part of the agricultural produce comes from monsoon-fed crops. The rains, which shower their benediction between June and September, account for 80 percent of the country’s total rainfall.
More than 600 million Indians depend directly or indirectly on agriculture for their livelihood. With low levels of irrigation, the monsoons have an outsize impact on agriculture. Strong agricultural growth drives rural demand in industries such as consumer goods, automobiles and fertilizers. The monsoons are also vital for farm output and economic growth in India, the world's second-biggest producer of rice, wheat, sugar and cotton.
Even if the monsoon is delayed by a few days, it can trigger a serious backlash. A good monsoon translates as a good harvest while a sub-par or bad one is a setback to the economy, resulting in a big loss to GDP. In 2009, the ruling Congress-led United Progressive Alliance (UPA) had to import sugar, which sent global prices zooming upward and pushing up inflation. Worse, between 2002 and 2006, 17,500 farmers committed suicide due to a killer cocktail of drought and debt.
Although the rains appear to be late, the meteorological department has forecast an average monsoon in 2012. That translates as rainfall between 96 and 104 percent of a 50-year average of 89 centimeters during a four-month season from June. Rainfall below 90 percent of the average is considered a drought.
While the government has tried to allay fears of adverse fallout, the situation on the ground is alarming. Food prices are already at historic highs. The prices of some commodities including vegetables and pulses have skyrocketed over 300 percent as compared to 2010.
This year’s paranoia, a recurrent annual leitmotif, drives home a simple warning – that India needs to improve its irrigation facilities and whittle down its dependence on monsoon rains. Even the International Water Management Institute has warned in a report that Asian nations need to “update their run-down irrigation systems if they wish to meet the challenge of feeding an extra 1.5 billion people by 2050”. No prizes for guessing that India – with its 1.2 billion people -- will be the biggest stakeholder in that scenario.
Why does India continue to depend so critically on the monsoons despite seven decades of Independence from British rule and growing heft at the geopolitical high table?
“One of the main reasons for this dependence is because there is very little land available for farming due to the onslaught of industrialization,” ,” agriculturist Dr Jagnannath Swami told Asia Sentinel. “Consequently, one has to augment productivity on existing land. This creates enormous pressure on the existing irrigation infrastructure which has not seen enough investment. Only an abysmal 30 percent of all agricultural land is irrigated.”
The agriculture sector, which has long been counted on as being recession-proof, has registered negative growth over the past couple of years owing to erratic monsoons. The country’s inability to reduce its dependence, mainly because of lack of adequate investment in irrigational infrastructure coupled with its inability to augment productivity of food grain, is choking agricultural growth.
Swami adds that it's easier to increase productivity with irrigation than it is by rain-fed agriculture. Hence, the Indian government needs to urgently look at strategic ways to help farmers. Instead of dishing out seeds and providing subsidies, rainwater harvesting needs to be promoted so that water can be “captured, stored, and distributed more effectively.”
Farmers also need to be educated about new technologies available to improve yield by installing sprinkler irrigation systems, analysts say, and access to microfinance needs to be improved, in which small ticket loans could be provided for investments in technology and know how.
“The Indian government has not made sufficient investments in ramping up irrigation techniques and water harvesting techniques,” said Kishan Chand, President Farmers’ Welfare Association, Hissar. “There aren’t enough storage facilities for our food grains either. If we have spacious granaries, stored food grains during bumper years can be used in years when there is inadequate rainfall helping to keep prices of food grains in check.”
But the ruling UPA dispensation as been so bedeviled by a policy paralysis that productive investments for India's long term growth has not been on its radar. Inadequate investment has been the biggest bane for the sector.
In a country where millions exist below the poverty line, subsisting on a meager dollar-a-day, these facts are causes for concern. This led the Finance Ministry to give precedence to this, the largest economic sector in India, in the yearly budget.
Millions of rupees have been earmarked for agriculture and allied sectors including the extension of the Green Revolution to eastern India, the enhancement of productivity in dry-land farming areas and the launch of a ‘climate-resilient agriculture initiative.’
To enhance agricultural productivity through better accessibility of good quality seeds and fertilizers, the government has approved the tax-exemption of the testing, certification, and transportation of agricultural seeds, and the provision of subsidies on fertilizers, says a report by Anirudh Nagammada.
However, some agriculture experts see a potential silver lining to a rain shortfall. “It gives the topsoil rest and gives it time to rebuild its nutrient content and thereby to rebuild its crop yielding capability,” Nirbhan Kang, an agriculturist at Punjab University, told Asia Sentinel. “In the absence of monsoon failure, farmers over-work their land.”
Nevertheless, the scientist hopes that recurrent erratic monsoons will send a strong message to the government to put in place non-monsoon dependent irrigation infrastructure. “A reliable irrigation system will help farmers grow multiple crops in a year to boost their income. Most irrigation systems are costly and meant for large tracts of land, while most Indian farmers are smallholders and till small tracts,” says Kang.
Experts also suggest micro-irrigation techniques which use cheap technology to water small tracts. These can aid India’s subsistence farmers using technologies such as treadle pump and affordable drip technology intervention.
But more than anything else, experts advise that India needs long-term and sustainable steps to ameliorate the impact of erratic rains. Linking the farmers directly to the market and augmenting farm and post-harvest infrastructure are good steps in that direction.
“The wasteful subsidy regime also needs to be overhauled. Fertilizer subsidies mostly benefit rich farmers and lead to gross overuse. As 60 percent of Indian farms being entirely dependent on rains, India needs a coherent policy on rain-fed agriculture,” advises Kang.