An inter ministerial panel has decided to offer work and wages under the national rural jobs programme for 150 days this year, instead of 100, and cut interest on farm loans from 12% to 7%. These steps are meant to blunt effects of a drought and cushion rural incomes in at least four states.
The latest round of measures suggests that despite a late revival in the southwest monsoon, it is unlikely to make up for the deficit in farming activities and a likely fall in food output."The decision to extend workdays under the Mahatma Gandhi National Rural Jobs Guarantee Scheme and the cut in interest rates will apply for a year in districts declared as drought-hit," a government official said.
An "empowered group of ministers" led by farm minister Sharad Pawar approved the key proposals that could stretch the finances further.
A drought has gripped four states - Karnataka, Gujarat, Maharashtra and Rajasthan - many of which have now begun receiving heavy rains after the monsoon burst into action two weeks ago.
Though the rains are expected to improve the drinking water situation, they are not likely to curb losses in crop yields. Uneven rains, especially at the start of the farming season, result in stunted crops and delayed sowing.
The monsoon is critical as two-thirds of Indians depend on agricultural income and 60% of farmlands do not have irrigation. The rains also replenish 84 nationally monitored water reservoirs, vital for drinking, power and irrigation. Weak rains also pose a major inflation risk.
This year's monsoon forecast had to be downgraded thrice, each lower than the previous one. The rains were first predicted to be 99%, followed by 96% and then down to 90%. Rainfall between 96-104% of 89 cm - a 50-year average - is considered normal, according to the national weather agency's classification.