Looking at normal monsoon and picking up of pre-monsoon kharif sowing, Reserve Bank of India (RBI), Governor, Shaktikanta Das said there is hope coming from the agriculture sector at this time of distress.
Commenting on the farm sector, former economic affairs secretary said, there are a few slivers of brightness amidst the encircling gloom. He added, “By April 10, pre-monsoon kharif sowing had begun strongly, with acreage of paddy – the principal kharif crop – up by 37 per cent in comparison with the last season.”
Das revealed that states such as West Bengal, Telangana, Odisha, Assam, Karnataka and Chhattisgarh are leading in sowing activity despite the lockdown.
In addition to sowing, the forecast of normal rainfall by the India Meteorological Department (IMD) is expected to uptick rural demand. Looking at all these developments, Das reiterated, “These early developments bode well for rural demand, supported as they are by accelerating fertiliser production up to February 2020.”
In his last address on March 27, Das had stated that agriculture and allied activities are continuing to show resilience, which he reiterated in his recent address too. He emphasised this is on the back of all-time highs in the production of food grains and horticulture, with huge buffer stocks of rice and wheat far in excess of the buffer norms. As per second advance estimates for 2019-20, total food grain production in the country is estimated at record 291.95 million tonnes which is higher by 6.74 million tonnes than the production of foodgrain of 285.21 million tonnes achieved during 2018-19.
Meanwhile, Das termed the situation in the production sector as “sombre”. On April 9, the index of industrial production for February showed that industrial output accelerated to its highest rate in seven months. Das said this is mainly because the impact of COVID-19 is not yet captured in the data.
He added the demand for power generation has also seen a decline of 25-30 per cent. “Automobile production and sales, and port freight traffic declined sharply in March. The manufacturing purchasing managers' index (PMI) for March 2020, which was released on April 2, was the lowest in the last four months,” he added.