Record wheat output wards off base effect in agri GDP

A record rabi harvest, especially for wheat, propelled India’s agriculture gross domestic product (GDP) for the quarter ended June to 2.9 per cent, compared with the market estimates of one per cent.

Growth in agriculture GDP in the corresponding period last year stood at 3.7 per cent.

According to data released on Friday, agriculture, forestry and fishing expanded 2.9 per cent during the quarter, helping raise overall GDP growth to 5.5 per cent, against 5.3 per cent in the year-ago period. Growth in the sector, which has a share of about 16 per cent in the GDP, was expected to fall to about one per cent, owing to a high base and fall in rabi pulses and oilseeds output.

 

“The growth was better than expected, mainly because last year’s rabi harvest was good, and the uneven rains did not impact much,” said P K Joshi, director (South Asia), International Food Policy Research Institute.

A part of rabi crops sown last year was harvested in 2012-13, and this aided the sector’s growth, economists said.

Madan Sabnavis, chief economist at CARE Ratings, said the agriculture sector had recorded good growth because of a record rabi production. India’s foodgrain production during the 2011-12 rabi season stood at a record 127.5 million tonnes, up 3.15 per cent over last year’s production, primarily because of an all-time high wheat harvest. In the 2011-12 rabi season, wheat production was about 94 million tonnes, eight per cent more than the previous year, while production of coarse cereals was 3.5 per cent more than the previous year.

However, rice production fell 16.6 per cent and production of oilseeds declined 12.6 per cent.

In the quarters ending September and December, the deficient southwest monsoon would have an impact on production. The southwest monsoon this year was about 12 per cent deficient till August-end. The low rains have fuelled fears of a drought in about 30 per cent of the country’s total landmass. These have also hit the sowing of oilseeds, pulses and coarse cereals.

Experts believe the impact of this would be seen when the agriculture ministry comes out with its first advanced estimate of the 2012-13 crop season, around September.

The Prime Minister’s Economic Advisory Council, in its full-year estimate for 2012-13, said agriculture growth was expected to slow to 0.5 per cent from 2.8 per cent in 2011-12, owing to the impact of the drought.