India’s farm sector recorded a robust 3.5 per cent growth in the third quarter of 2019-20 (October to December) on the back of good kharif harvest and expected bumper rabi crop. In the same period the output might have fetched good price to farmers as inflation (difference between growth in current and constant prices, which sometimes is used as a proxy for farm incomes) is estimated at 10.2 per cent — the best in past several quarters.
As a consequence of steady rise in the third quarter, the National Statistical Office (NSO) estimated that the farm sector growth in 2019-20 fiscal year will now be at 3.7 per cent, up from 2.4 per cent during 2018-19. Farm sector growth at current prices is projected at 11.3 per cent in 2019-20, up from 4.5 per cent in 2018-19, largely due to higher prices of food items primarily for the allied sector. This entails that inflation in agriculture produce in 2019-20 is estimated at 7.6 per cent.
“The allied sector, largely livestock, fisheries, and horticulture, is expected to fetch better price to growers and this constitutes almost 45 per cent of the total share of agriculture and allied activities, which is why the growth in current prices is projected at 11.3 per cent,” Madan Sabnavis, chief economist, CARE Ratings, told Business Standard.
The second advance estimate of foodgrain production released a few days ago estimated the wheat output at an all-time high of 106.21 million tonnes. The data showed that the estimated wheat production in 2019-20 crop year, which started in July 2019, is 2.61 million tonnes more than the 2018-19 harvest and 5.71 million tonnes more than the target for this year.
It also showed that among other major rabi crops, production of gram is estimated to be 11.22 million tonnes, up 12.80 per cent from last year. Output of mustard, the biggest oilseed crop grown during the rabi season is projected to fall marginally to 9.11 million tonnes, down 1.54 per cent from last year.
Total rabi foodgrains, which also include pulses and coarse grains, according to the second advanced estimate was projected at 149.60 million tonnes, up 4.10 per cent than last year.