The revival of monsoon rains in the grain bowl of northwest and central regions should help speed up sowing of main summer crops such as rice, corn, soybean and cotton.

Rains are vital to India's farm sector, which accounts for about 14 percent of the country's nearly USD 2 trillion economy. Two-thirds of its 1.2 billion populations live in rural areas.

Last year, monsoon rains covered the country almost a month ahead of schedule, helping grain output hit a record level.

Monsoon rain deficit narrows, enters active phase

The deficit in monsoon rains is expected to narrow next week as the grain bowl in India's northwest, oilseed areas of central parts and cotton belt of the western region are set to get higher downpours.

The monsoon rains were 15 percent below average in the past week, against 41 percent below average rainfall in the previous week, the weather office data showed.

"This active phase is likely to continue for next ten days," said BP Yadav, head of the National Weather Forecasting Centre at the India Meteorological Department.

Poor rains since the start of the June-September season had raised concerns that India would face its first drought in five years with coverage for most of the main crops slipping below their half way marks.

The predicted wet run in monsoon should improve the level of water in reservoirs that is important for drinking purposes, hydro power generation and irrigation.


Deficient monsoon may 'cast a cloud' on inflation outlook: D&B

Inflation numbers have showed some improvement in the month of June and but deficient monsoon may "cast a cloud" on the price front going forward, says a Dun & Bradstreet report.
According to D&B, the WPI inflation and CPI inflation is likely to remain in the range of 5.2 percent-5.4 percent and 7.4 percent-7.6 percent, respectively for this month.
Monsoon rains are very crucial for the agriculture-driven Indian economy, as nearly 60 per cent of agricultural area is still rain-fed and rains have implications for both inflation and growth.
"Even as the overall price situation showed some improvement, deficient monsoon may cast a cloud on WPI inflation outlook," Dun & Bradstreet India Senior Economist Arun Singh said.
Singh further added that the "proactive measures taken by the Government to mitigate the impact of deficient monsoon on inflation would play a crucial role going forward."
After rising to a five-month high in May, inflation dipped to 5.43 percent in June, while retail inflation fell to a 30-month low of 7.31 percent last month.
The headline WPI inflation and CPI inflation is expected to remain range-bound during July 2014 amid late revival in monsoon and easing of primary article inflation, the report said.
"The recent weakness in the currency and expected deficient in monsoon pose upside risks to inflation," D&B added.
On the Union Budget, the report said that even though devoid of big-bang announcements, there has been a focus on almost every key sector of the economy accompanied by a host of new ideas and initiatives.
"Through its focus on infrastructure, entrepreneurship and a host of facilitation measures to ease investment climate, the Government has given a clear direction of how it intends to reboot the economy going forward," Singh added.


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