Poor rains may cut output, add to inflation woes

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Poor rains in India's key pulse-producing southern and western states have affected sowing and could trim output in the 2012-13 year that began on July 1, the agriculture minister said on Friday.

Lower output of pulses could force India, the world's largest producer and consumer, to import more lentils thereby adding to inflation woes.

India, the world's leading importer of lentils, consumes over 20 million tonnes of assorted lentils, or pulses, but production is less than that and the gap is met through imports from Australia, Canada and Myanmar.

Maharashtra, Karnataka and Andhra Pradesh received poor rains in June, which is crucial for the plantation of the pulses. Since sowing has been delayed, it will affect the production of pulses in 2012-13, farm minister Sharad Pawar told reporters on the sidelines of a conference.

Pulses are a staple in the Indian diet. They contribute 0.72 per cent to India's inflation, which at 7.55 per cent currently is worrying the government at a time of slowing economic growth.

The June-September monsoon rains, the main source of water for 55 per cent of India's arable land, were 30 per cent lower-than-normal since the beginning of the monsoon season.

India's 1.2 billion people make it one of the world's biggest consumers of rice, sugar and grains. While it is usually self-sufficient in these foodstuff, the country is a major importer of pulses and edible oils.

"I see the situation is not worrisome for paddy as of now," Pawar said.

The shortage of rains should not have a big impact on rice planting in the states like Punjab and Haryana, the major contributors to government granaries, where about 93 per cent of arable land is irrigated.

Among the key rice-producing eastern states, Odisha and Chattisgarh had received sufficient rains, Pawar said.

India in recent years has produced bumper harvests of rice, a staple food for many Indians and handed out at subsidised rates to the country's half a billion poor. In 2011 bulging stocks prompted the government to allow exports of the staple.

The country could emerge as the world's second-largest rice exporter this year after Thailand.

The farm sector accounts for about 15 per cent of a nearly $2 trillion economy, Asia's third-biggest, where good harvests are crucial to maintain rural incomes and thereby keep up the demand for gold and consumer goods.