Drought

The deficit in rain will certainly lead to shortfall in food grains production. But the impact of shortage of rainfall will be very severe to the farming community. Many areas of the country are already reeling under drought situation. Many irrigation dams, lakes and tanks have already dried and as a result there is the possibility of decline in the total area under cultivation of wheat and paddy, besides pulses. It will certainly cause decline in the earnings of the farming community, which will have a cascading effect on aggregate demand in the country. It is quite possible that prices of food grains will go up, which would make it difficult for the common man to buy adequate food grains, pulses and vegetable. But one redeemable factor is the unprecedented stock of food grains in the godowns. In fact huge quantity of food grains is rotting due to lack of adequate storage capacity as well as manpower to manage such a substantial increase in stock in central pool. The total stocks across the country in the central pool are expected to be an all-time record of about 75.0 million, which is almost one lakh tone more than last year. It is reported that FCI and the state agencies are faced with unprecedented problems of shortage of storage capacity resulting in large stock of wheat in CAP (kept in open plinths covered with tarpaulin) in Punjab, Haryana and Madhya Pradesh. Above all, fodder will be the major problem, which the government has to consider seriously.Dr.C.Murukadas,, The Economic Times, 29 Jul, 2012 02