New Delhi, April 19: With the India Meteorological Department forecasting a normal monsoon this year, the government will get a helping hand in containing food and overall inflation, which is still above the comfort level.
The country’s agriculture sector, which is 60 percent dependent on rains, will also be able to grow at the above-3 percent level forecasted by economists.
“IMD’s long range forecast for the 2011 southwest monsoon season (June-September) is that the rainfall for the country as a whole is most likely to be normal which is 96 to 104 percent of the long period average,” said Science and Technology Minister Pawan Kumar Bansal.
IMD will update the monsoon forecast in June as part of the second stage forecast.
“There is very low probability for season’s rainfall to be deficient, which is below 90 percent, or excess, which is above 110 percent. Quantitatively monsoon season rainfall is likely to be 98 percent of the long period average,” he added.
Though, food inflation has declined successively for three weeks it still remains on the higher side at 8.28 percent as recorded for the week ending April 2. However the annual rate of inflation rose to 8.98 percent in March.
Higher levels of food inflation tend to spread to other items, making overall prices go up.
Hence a normal monsoon brings relief to policymakers and farmers alike.
On its part, the government has mainly looked to the Reserve Bank of India to tighten interest rates as a way of curbing inflation. Though it did that eight times since January 2010, prices still remain a worry.
———IAns