SBI sees good monsoon to help agriculture GDP grow 7-8% in FY17

SBI says the farm growth may pull-up baseline GDP by as much as 50 basis points

PTI April 15, 2016 07:45:45 IST
SBI sees good monsoon to help agriculture GDP grow 7-8% in FY17

Mumbai - The Country's agricultural GDP is most likely to witness a robust performance in 2016-17 and may even touch 7-8 percent if Met's prediction of a good monsoon comes true, says an SBI report.

The India Meteorological Department (IMD) has predicted a "above normal" monsoon for this year, easing fears over farm and economic growth after two consecutive years of drought.

SBI sees good monsoon to help agriculture GDP grow 78 in FY17

Reuters

"We believe the agricultural GDP is most likely to witness a robust performance in 2016-17 and may even touch 7-8 per cent mark because of IMD projections amid the governments plan to lift agriculture sector," the SBI research report said.

"This may pull-up baseline GDP by as much as 50 basis points," it added.

Interestingly, the report has also noted that there are instances where agri GDP has in fact expanded in years of deficient rainfall.

"In 2003 and 2010 agri GDP expanded by an average of 8.5 per cent following years of poor rainfall," it said.

On inflation front, the report estimates CPI (consumer price index) inflation trajectory to be "significantly benign in the current fiscal".

"We maintain that over a point of time as pulse prices decelerate, the pace of price increase will come down," it observed.

"This in turn means RBI will have more firepower to cut rates possibly by upto 50 basis points. Also, with central India, the home to pulses, forecast to receive adequate rainfall in FY17, will only strengthen our case," it added.

According to IMD, monsoon will be 106 per cent of the long period average (LPA) and there is 94 per cent probability that monsoon will be normal to excess this year for most parts of the country.

Agriculture, which contributes about 16 per cent to the countrys GDP and employs about 60 per cent of the population, is heavily dependent on the monsoon as only 40 per cent of the cultivable area is under irrigation.

Updated Date:

also read

India administers over 74 crore COVID jabs; all adults in six states, UTs vaccinated with first dose
India

India administers over 74 crore COVID jabs; all adults in six states, UTs vaccinated with first dose

Dadra and Nagar Haveli and Daman and Diu, Goa, Himachal Pradesh, Ladakh, Lakshadweep, and Sikkim are the states and UTs with 100 percent adult population vaccinated with the first dose

Market cap of four of top-10 most-valued cos jumps Rs 65,464 cr; Airtel, SBI lead gainers
Business

Market cap of four of top-10 most-valued cos jumps Rs 65,464 cr; Airtel, SBI lead gainers

During the last week, BSE jumped 710 points or 1.21 percent, while market benchmark Sensex scaled the 59,000-mark for the first time

SBI revamps Pension Seva website, see checklist of facilities offered to pensioners here
Business

SBI revamps Pension Seva website, see checklist of facilities offered to pensioners here

Pensioners can avail themselves of a variety of services at the website https://www.pensionseva.sbi/ and manage their pension-related services easily