Good monsoon likely, may cushion impact

India’s summer monsoon will be better than previously forecast, raising hopes of good harvests, badly needed to cushion the inflationary impact of the government’s decision to deregulate petrol prices.

India’s summer monsoon will be better than previously forecast, raising hopes of good harvests, badly needed to cushion the inflationary impact of the government’s decision to deregulate petrol prices.

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The rains from June to September this year are likely to be 102 per cent of the average annual rainfall, the weather bureau said, upgrading its earlier forecast of 98 per cent.

“Global parameters and all models show monsoon is on track and would be normal,” Met chief Ajit Tyagi said.

The inflation figure may also be held back by a favourable ‘base effect’ — fuel prices will not be seen substantially pushing up inflation, calculated year-on-year, because petroleum prices were hiked around this time last year too, a senior government economist said. “If monsoon is good, inflation will be down to acceptable levels by December,” chief economic adviser Kaushik Basu said.

Rains have been 11 per cent deficient so far.