Page 14 - CII Artha Magazine

The overall consequence of Summing Up
insufficient rainfall is delayed Figure 9: CPI Inflation Across Major Food Articles in August 2023 (y-o-y%) Appendix A
sowing progress, particularly for
crops having inadequate 35.0 32.2 There has been a huge disparity
irrigation facilities. Moreover, in the distribution of monsoon Table A.1: Regression results of crop production on irrigation and rainfall
inadequate rainfall has 30.0 rainfall across regions. August’s
intensified inflationary 25.0 dry spell is of particular Oilseeds
pressures. This inflationary concern as it led to delayed Independent Foodgrains Rice Jowar Maize Pulses (Groundnut)
surge is most pronounced in 20.0 17.3 sowing of kharif crops like variables
Log
Log
Log
Log
Log
Log
the case of pulses, with arhar 15.0 pulses and jowar, which could (Pfoodgrain) (Price) (Pjowar) (Pmaize) (Ppulses) (Poilseed)
experiencing a staggering 32.2 12.5 impact crop production and
per cent increase in inflation 10.0 8.4 6.8 9.2 yield. Crops like rice, which c -7.17 *** -9.94 *** -4.71 *** -5.82 *** -5.13 *** -6.67 ***
due to delay in its sowing 5.9 have benefitted from irrigation, *** *** *** *** *** ***
(figure 9). In the case of coarse 5.0 1.8 have remained resilient. Log(areasown) 1.04 1.83 1.38 2.26 1.37 0.29
cereals, jowar has experienced a 0.0 Insufficient rainfall has also Log(irrigation) 1.20 *** 1.44 *** 0.99 *** 0.28 * 0.44 *** 0.24 ***
significant inflation rate of 17.3 Rice Jowar Bajra Maize Arhar Urad Moong Oilseeds
per cent, attributed to its contributed to inflation, Log(rain) 0.43 *** 0.26 *** 0.24 0.24 0.34 *** 1.08 ***
delayed sowing progress and Source: MoSPI especially among pulses and
lack of irrigation facilities. coarse cereals, which can R 2 0.99 0.98 0.81 0.96 0.87 0.77
potentially impact food security.
The presence of El Nino raises Adjusted R 2 0.99 0.98 0.80 0.95 0.86 0.76
Historically, the presence of El experiencing inadequate to deficient rainfall. In cases concerns about future rainfall
INTENSIFYING EL Nino has been associated with rainfall is notably high, where rainfall has remained patterns that can further have Source: CII Research
NINO RAISES a weakened monsoon season, particularly in the presence of within the normal range or an adverse effect on crop
CONCERNS often resulting in below a strong or moderate El Nino above normal, the El Nino's production, yield and inflation
average or deficient rainfall. event (figure 10). 67 per cent strength has been relatively rates. Table A.2: Sub-sample regression results of crop production
The probability of of such occurrences have led weak. on irrigation and rainfall
This year, the El Nino While Indian agriculture has
phenomenon developed in July made significant strides in Oilseeds
and remained relatively weak Figure 10: Rainfall During El Nino Years reducing its reliance on Independent Foodgrains Rice Jowar Maize Pulses (Groundnut)
during the month. However, its 20.0 monsoon rainfall through variables
Log
Log
Log
Log
Log
Log
influence became evident in increased irrigation for (Pfoodgrain) (Price) (Pjowar) (Pmaize) (Ppulses) (Poilseed)
August with notable deficit in 10.0 foodgrain production, this
rainfall across India. According 0.0 transition isn't uniform across 1950-1980
to IMD, El Nino phenomenon all crops. Major crops like
is expected to transition to -10.0 coarse cereals, pulses and c -9.15 *** -9.01 *** -2.97 * -1.03 -2.18 ** -5.70 ***
moderate strength in oilseeds remain susceptible to Log(areasown) 1.96 *** 2.38 *** 1.08 *** 1.91 *** 0.76 *** 0.61 ***
September, with the potential -20.0 monsoon variability due to
to strengthen further by -30.0 limited coverage of irrigation Log(irrigation) 0.68 *** 0.43 *** 0.96 *** -0.19 * -0.34 *** 0.16 ***
December. These 1952 1953 1954 1958 1959 1964 1966 1969 1970 1973 1977 1978 1980 1983 1987 1988 1992 1995 1998 2003 2005 2007 2010 2016 2019 which presents a significant
developments raise concerns challenge. Log(rain) 0.31 *** 0.36 *** 0.11 0.01 0.43 *** 0.87 ***
about the potential Strong Moderate Weak
consequences for rainfall in Source: IMD and NOAA Given the rising unpredictability 1980-2000
the months ahead. of monsoons due to climate
change, substantial investments c -7.28 *** -10.3 *** -2.64 -9.67 *** -5.49 *** -5.28 ***
in expanding irrigation * *** *** *** *** **
Previous episodes of El Nino moderate level by September infrastructure are critical for Log(areasown) 0.99 2.01 1.13 4.53 1.12 1.09
have typically resulted in falling this year, the outlook for Figure 11: Agriculture GVA, Kharif Production and Yield during El Nino years ensuring food security and *** *** ** *** **
agricultural GVA and severely rainfall remains a cause for stable agriculture production in Log(irrigation) 1.25 1.05 0.47 0.15 0.38 0.44
impacted kharif production concern. It is highly likely that 20.0 the future. There is a need for
and yield (refer figure 11). In India may experience below 10.0 targeted irrigation expansion Log(rain) 0.45 *** 0.43 * 0.17 0.47 ** 0.53 ** 0.55 *
majority of these cases, low normal or deficient rainfall in 0.0 for vulnerable crops to reduce
kharif production and yield the coming months with -10.0 their susceptibility to monsoon 2000-2022
have often been associated potentially adverse effects on variability. Other measures like c -8.04 *** -6.01 *** -5.36 *** -4.17 *** -4.53 *** -9.65 ***
with moderate or strong agriculture GVA, kharif -20.0 crop diversification, efficient
intensity of El Nino. production and yield. -30.0 water management practices, Log(areasown) 1.66 *** 0.63 ** 1.03 *** 1.68 *** 1.29 *** 0.87
1969 1970 1973 1977 1978 1980 1983 1987 1988 1992 1995 1998 2003 2005 2007 2010 2016 2019 inflation management, and
Given the current expectation investing in climate-resilient Log(irrigation) 1.17 *** 1.85 *** 0.38 0.67 ** 0.42 *** 0.57
of El Nino phenomenon Agriculture GVA(%) Kharif Production (yoy%) Kharif Yield (yoy%) agriculture practices are pivotal
potentially intensifying to a Source: Department of Agriculture and Farmers Welfare for mitigating the risk of erratic Log(rain) 0.14 0.11 0.63 *** 0.21 0.29 ** 1.23 **
monsoon and safeguarding food
security in face of monsoon Source: CII Research
uncertainties.
14 ANALYSIS, RESEARCH, THOUGHT LEADERSHIP & ADVOCACY ANALYSIS, RESEARCH, THOUGHT LEADERSHIP & ADVOCACY 15
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