With more states and districts joining the growing list of drought-affected regions, Prime Minister Manmohan Singh on Tuesday once again appraised states about the enormity of the problem and asked them to jointly work to mitigate the suffering of people, mainly farmers. This was the third time in four days that the Prime Minister impressed upon states to take all possible measures to counter the effects of low rainfall.
?We are staring at the prospect of an impending drought,? Prime Minister Manmohan Singh told a meeting of environment ministers of states. India?s vital monsoon rains have been 29% below normal since the beginning of the June-September season, hurting crops such as rice and cane and triggering a sharp rise in food prices in India and sugar futures abroad. Monsoon rains revived in the past few days, particularly in the cane-producing Uttar Pradesh state, where the state government has declared a drought in 58 out of 71 districts, but this has not eased concerns of government and trade officials. The drought and its fallout on agriculture production will also have its impact on prices, seriously threatening RBI?s year-end projected inflation target of 5%. ?The expectation is that the erratic monsoon may put pressure on inflation,? RBI deputy governor K C Chakrabarty told reporters on the sidelines of a meeting of regional rural bank chiefs with Finance Minister Pranab Mukherjee.
The Finance Minister had called the meeting with representatives of regional rural banks to work out ways to extend credit to growers to fight low rains and increase penetration in hitherto untouched areas.
Talking to reporters after the meeting Finance Minister Pranab Mukherjee exuding confidence that the economy would grow by over 6% despite erratic monsoon. He also denied that the government was considering any fresh proposal for farm debt waiver even as over one-fourth of the country is reeling under drought. ?There is no such proposal,? Pranab Mukherjee said when asked if the government was considering a fresh debt waiver scheme to give relief to farmers.
The UPA government had last year announced a nearly Rs 71,000 crore farm loan waiver scheme to offer relief to small and marginal farmers and one-time settlement scheme for large ones. Planning Commission deputy chairman Montek Singh Ahluwalia said the poor monsoon will adversely impact farm production and eat into economic growth. In a related development, low rainfall has slowed the refilling of India?s main water reservoirs, threatening the supply of hydropower, which accounts for a quarter of India?s generation.
?Hydropower generation in India had fallen 10% from last year,? Central Electricity Authority Chairman Rakesh Nath told reporters. The highest policy making body of the Congress, the CWC is expected to meet Wednesday to discuss the drought-situation in the country and suggest measures to the government. Agriculture minister Sharad Pawar is scheduled to hold a discussion with state food, civil supplies and sugar ministers to discuss the food price situation and steps being taken to bring down prices.
Meanwhile, states continued to appraise the centre with their demand for drought-relief. On Tuesday, Jharkhand demanded 43,000 tonnes of rice from the central pool to meet its drought-relief requirement.
The state has declared drought in most of its districts. Neighbouring Bihar, which has declared drought in 26 out of the 38 districts in the state demanded a relief package of Rs 23,000 crore to meet the emergency.
A team of central government officials will begin touring the drought-hit areas of the state from Wednesday to assess the impact of low rains on crops and agriculture. Karnataka has sought Rs 400-crore relief under the Calamity Contingency Fund for drought-affected areas in the state.
?The number of districts where drought or drought-like conditions are prevailing have now gone up to 204 from earlier assessment of 177,? official sources said.