August 2, 2011

India's agriculture faces deficient rain, high input costs

Pressures of deficient south-west monsoon, increasing input costs and labour shortage have weighed on the sowing process in India, and this could lead to high food inflation, according to a survey by industry body PHD Chamber of Commerce and Industry (PHDCCI).

"The input costs have increased by more than 70% in the current crop year compared with the last crop year," the industry chamber said in a statement.

The agriculture wage rate has been reported to touch INR250 (US$5.70) per day from INR150 (US$3.40) and the cost of diesel and fertilisers has increased by about 25% and 20%, respectively, it added.

According to the survey, major agrarian states like Bihar, Uttar Pradesh, Punjab and Haryana have received deficient rains. The cumulative rainfall for the period June 1 to July 27, 2011 is deficient by 4%.

"These monsoon deficient states contribute around 45% and 40% to India's food grain and commercial crops production, respectively," it said.