Over the last 48 hours, India’s ruling combine had two reasons for euphoria: electoral triumphs in three states and the announcement that the economy will grow by 6.5 per cent this year.
But a footnote in the economic data has revealed how the euphoria must be put aside immediately, as climate change poses the next big political challenge for the Congress party.
A season of withering drought and damaging rainstorms is predicted to cut India’s agricultural output by 2 per cent, despite a 400 per cent rise in rural spending on jobs and infrastructure by the government since Prime Minister Manmohan Singh took office in 2004.
With climate-change models predicting harsher droughts, storms and floods across India as the earth warms, rescuing the livelihoods of 670 million Indians who survive on farming is an immediate and long-term economic and political challenge, a range of experts told the Hindustan Times.
* India will produce 11 million tonnes less foodgrain during 2009-2010 than the previous year.
* Inflation in food prices is up 14.13 per cent between March and October this year
* Since March this year, vegetable prices have shot up 58 per cent
“Despite fiscal and monetary stimulus packages, there are strong risks emanating from poor monsoons that could delay the recovery in the economy,” said N.R. Bhanumurthy, professor at the National Institute of Public Finance and Policy, a Delhi think-tank.
Scientists predict a best-worst-case global temperature rise anywhere from 1.1 to 6.4 deg C. But even a half-degree rise in India — the world’s second-largest wheat producer — will reduce wheat yield by a fourth.
“The situation will be substantially worse by 2050, marked by higher temperatures that will certainly affect India’s wheat yield,” said Gerald C. Nelson, a senior scientist, who led a study completed last month by the International Food Policy Research Institute (IFPRI) in Washington D.C. Nelson said it was “crucial” for rural incomes to keep going up because people with better incomes were more resilient to climate change impacts.
This year, the UPA government has a Rs 40,000 crore budget for its flagship job scheme against rural poverty, but it will spend 1/40th of that on expanding irrigation facilities. The IFPRI study was based on two models evolved in the US and Australia and released in September. They differ on the intensity of rainfall but what they agree on is in line with earlier predictions on the monsoon: India will have stronger droughts and get more rain. But the rain will also come in damaging storms, as Andhra witnessed last month.
About half of India’s farms depend on rains. India has built small and big dams that can irrigate 58.74 million hectares, about 50 per cent of the farmed area.
Instead, thanks to unfinished canals and other infrastructure, irrigation facilities — they cost Rs 1,42,269 crore over the last 15 years — actually reaches only 40 per cent of farmland.
India requires $272 billion (Rs 12,78,400 crore) over the next nine years to expand its irrigation network, according to a September 2009 Goldman Sachs report. This is nine times India’s defence budget for 2009-10, “We have to get stability from better irrigation and water management,” said Surinder Singh, farm adviser to the Planning Commission.
The share of agriculture and allied activities in India’s gross domestic product has declined over the years to 17.5 per cent. But a good harvest stabilises food prices, assures a livelihood for 55 per cent of the labour force and shores up the broader economy.
Historically, every drought year has dampened India’s overall economy.
In many sectors, such as automobiles, rural buyers account for close to 40 per cent of total sales. This is also true of televisions and other consumer durables, which grew 22.3 per cent in August this year, the highest in more than five years.