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Farm sector can grow over 6% in FY25 on good monsoon

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The agriculture and allied sectors may register over 6 per cent growth in 2024-25 going by the predictions of a favourable monsoon and the low base of the previous year, NITI Aayog member Ramesh Chand told businessline.

“This year (2024-25) will be highly favourable for agriculture, mainly due to two factors. One, the monsoon rainfall will be normal or above normal, per reports by various agencies. Even in terms of regional distribution, the forecasts are encouraging. Two, the agriculture growth in 2023-24 was 0.67 per cent, which means the base (for 2024-25) is low,” Chand said.

Whenever such a combination has happened in the past, farm sector growth has topped 6 per cent, he observed. “There is no reason this past pattern will not be repeated this year if the monsoon rainfall turns out as predicted,” Chand added.

The India Meteorological Department (IMD) has predicted an “above normal” monsoon, at 106 per cent of the long-period average (LPA) of 87 cm, while private weather forecaster Skymet has said the monsoon is likely to be “normal” at 102 per cent of the LPA.

The NITI Aayog member pointed out that “real prices” of agriculture have been rising for several years. “If you take the wholesale prices of agriculture relative to non-agriculture, farm prices are rising. The wholesale price index (WPI) of agri-commodities is rising faster than non-agri-commodities,” Chand said, adding that stability in maintaining prices is required due to this aspect.

The government’s action to maintain stability is seen by some as a move to bring down prices, he pointed out, adding that such was not the case. “Stability means to prevent an abnormal or unusually high level rise in the price of a commodity.”


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Boosting exports

Chand also favoured allowing increased exports in case of surplus production of certain crops during the kharif season.

Currently, the government has restricted export of non-Basmati rice, wheat, sugar, and onion. The curbs on non-Basmati rice may be revisited in September-October when the government will have made an assessment on rice production, official sources had said earlier.

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