Poor monsoon to hit growth, says Montek
Planning Commission Deputy Chairman Montek Singh Ahluwalia on Tuesday said that the poor monsoon will adversely impact farm production and trim economic growth.business Updated: Aug 18, 2009 21:31 IST
Planning Commission Deputy Chairman Montek Singh Ahluwalia on Tuesday said that the poor monsoon will adversely impact farm production and trim economic growth.
“The existence of drought by itself can lead to some shaving down of the growth projections,” he said. The impact, however, will not be much on gross domestic product (GDP), as agriculture production constitutes less than 20 per cent of the economy.
On the impact of decline in farm output on economic growth, he said, “If you have decline in farm production, one fifth of that percentage would be knocked off from the projected GDP growth rate. Obviously, there would be some effect but not very large.”
Pointing out that Kharif output (summer crop) will suffer on account of the poor monsoon, Ahluwalia said there would be no impact on Rabi (winter crop).
“The negative impact (of drought) will not be on the country as a whole, but in some affected parts. No doubt that the (farm) output of some states will fall and there will be some distress,” he added.
Ahluwalia further said that now it would be too early to make an assessment about growth for the entire country.