Going by normal standards, this year's monsoon - which is now officially in retreat - could be viewed as benevolent. The all-India weighted average rainfall was seven per cent above normal, the largest surplus since 1994; the country could not have asked for more. This is all the more significant since it has come at a time when food inflation is high and overall economic growth slipped to a four-year low of 4.4 per cent in the first quarter of this fiscal year. Though agriculture, too, grew only 2.7 per cent in that quarter, the impact of the monsoon is likely to push the sector's annual growth to above five per cent, substantially higher than last year's 1.9 per cent.
Such a strong rebound will help the overall economy - perhaps more through an indirect effect, than directly through its contribution to the country's gross domestic product. It should translate into a 15 to 20 per cent increase in nominal rural incomes. That should strengthen rural demand for consumer goods and spur construction and other activities in the countryside, thereby boosting services and other sectors. Moreover, the good monsoon has replenished the water reservoirs that irrigate crops and run hydel power plants. Most of the country's 85 major dams have been filled to capacity, holding a total water stock of 125.84 billion cubic metres, 29 per cent higher than last year's level and 26 per cent in excess of the past decade's average. This bodes well for industrial production. Besides, the anticipated larger output of food, fodder, fibre, fuel and cash crops is likely to ease prices of farm commodities and bring down food inflation. All this would, evidently, come as a welcome relief for the government ahead of the next year's general elections.
A notable feature of the southwest monsoon, which is by far the world's most reliable rain-bearing system, is that it seldom showers its largesse evenly on all parts of the country. This year, too, almost all of the east - especially Bihar, Jharkhand and the northeast - has remained rain-deficient, which has affected the region's main crop, paddy. Though some small pockets elsewhere, too, have experienced rain deficiency, such as Haryana, the deficit there does not matter much for farm output, thanks to extensive irrigation facilities. At the macro level, however, the anticipated decline in crop production in the east is expected to be more than made up by larger harvests in the rest of the country.
This year's monsoon is also worth comparing with last year's, given sharp dissimilarities between the two. Last year, the agriculturally critical months of June and July remained rain-starved in most of the country, raising the spectre of drought and adversely affecting crop sowing. In contrast, this year rainfall was exceptionally good during this period, which facilitated extensive crop planting. A regrettable common factor in the two cases: the country's official weather forecaster, the India Meteorological Department (IMD), failed to foresee either the prolonged initial dry spell in the last season or the remarkable early wet phase this year.
