There is more to the summer rains than just a cool respite or the romance of pitter-patter: it is the country’s life-blood. As Asia’s third-largest economy tries to claw out of a sharp slowdown, a patchy monsoon last year appears to have played spoilsport by crimping food output, raise prices all
around and pull down farm income necessary for overall economic growth.
India's agriculture output growth is set to slowdown to 1.8% in 2012-13, down from 3.6% last year, latest national income data showed.
"Production of foodgrains is expected to decline by 2.8 % as compared to growth of 5.2 %in the previous agriculture year. The production of cotton and sugarcane is also expected to decline by 4% and 6.5%, respectively, in 2012-13," a statement by the Central Statistical Organisation (CSO) said.
A patchy monsoon trims food output and hits farm income, which supports two-thirds of the Indian population, or about 800 million people. Rural spending on most items - from television sets to gold - goes up with adequate rains and farm output. This aids economic growth, keeps jobs and investment going.
A sharp rise in rural consumer spending explains why India’s rural markets are important. For instance, rural buyers account for close to 40% of India's total motorcycle sales.
High prices essentially shrink household incomes, as middle-class Indians have to spend much more for the same amount of goods. Since the 2009-10 food-price shocks could not be controlled in time, they spread into what economists call “core inflation”, or prices of non-food and non-fuel commodities.