El Niño's Impact on India's Kharif Crops and Inflation Risks
El Niño clouds loom over kharif crops, farm pay
The Economic TimesImage: The Economic Times
The El Niño weather phenomenon threatens India's kharif crops, with forecasts predicting below-normal rainfall this monsoon season. This could lead to reduced agricultural output, increased inflation, and lower farmer incomes, particularly affecting oilseeds and pulses.
- 01The India Meteorological Department forecasts monsoon rainfall at 90% of the long period average, raising concerns for kharif crops.
- 02Historical data shows an average decline of 1.3% in kharif crop output during previous El Niño years.
- 03Key crops like jowar and tur could see production declines of 28% and 17.1%, respectively.
- 04The World Meteorological Organization predicts an 80% chance of El Niño developing from June to November.
- 05Inflation risks are heightened, with estimates suggesting a 5.1% inflation rate for FY27.
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The El Niño weather phenomenon, originating in the central Pacific Ocean, poses significant risks to India's agricultural sector, particularly the kharif crops. The India Meteorological Department (IMD) has projected below-normal rainfall this monsoon season, estimating it at 90% of the long period average (LPA). Historical analyses indicate that strong El Niño events have led to an average 1.3% decline in kharif crop output, with vulnerable crops including jowar and tur, which may see production drops of 28% and 17.1%, respectively. The World Meteorological Organization has indicated an 80% probability of El Niño developing between June and November, coinciding with the crucial monsoon period. This could exacerbate inflation, as lower agricultural productivity directly impacts prices, especially for vegetables, pulses, and edible oils, which constitute about 9% of the Consumer Price Index (CPI). Experts warn that inflation could reach 5.1% for FY27, with risks skewed to the upside due to geopolitical tensions. El Niño's effects could also ripple through the rural economy, impacting livelihoods reliant on agriculture.
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The anticipated decline in kharif crop output due to El Niño could lead to increased inflation and reduced farmer incomes, significantly affecting the rural economy.
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