A good monsoon will have multiplier effects to boost slowing economy
In this season of economic gloom, with plummeting rupee, faltering GDP, high twin deficits and high food inflation, it is easy to take an extreme view that this is the end of India's growth story. But real strategists keep their calm and look up for a silver lining.
Here could be one: so far, the monsoon (June 1-September 6, 2013) is 8% above its long period average (LPA). Of the 36 meteorological subdivisions, 30 have had normal or excess rainfall. The water level in 85 reservoirs is 129% of the storage in the corresponding period last year. Hopefully, even if the remaining September is somewhat below normal (and not totally wiped out), overall monsoon (June-September) could end up being 5-7% above the LPA.
This could still be the best or second-best monsoon in the last 17 years. And this water availability is critical for India as more than half of its cultivated area is still rain-fed. Read More