RABI CROPS - AB RAB HI BACHAYE!
By Ruma Dubey
While we are all very busy texting and giving opinions of social media about Aamir Khan and the Winter Session, there is a sense of disquiet in the hinterlands of India. They have a life changing situation and could be least bothered about Aamir threatening to leave India.
The rural farmers are unnerved. Kharif was bad and now rabi crops too are not looking all that good. There is data to support to this sense of anxiety. The Ministry of Agriculture has put out a report saying that the total area sown for Rabi crops touched 12.3 million hectares by 13 November 2015, down 23% (YoY).
The area sown under pulses on YoY rose 13% to 3.9 million hectares by 13 November 2015. Also, area sown for coarse cereals rose by 24.5% to 3.5 million hectares. But, area sown for wheat fell by a huge 56.5% to 1.9 million hectares. Area sown under oilseeds fell by 42.5% to 3.1 million hectares and that under rice fell by 53% by 13 November 2015.
Rabi or winter crops, are sown between October to February and harvested by June. And the most important rabi crop is wheat. On the other hand, Kharif crops are sown during April-July, and harvested by October, with the most important Kharif crop being paddy.
What this shortfall as of now means that we could be paying more the foodgrains; pulses as such, now wheat and rice too. Forget us urban people; we are anyway destined to pay more for all basics of life. But a poor harvest means less money in the hands of the farmers and with over 60% of India living in villages, surely it would mean consumerism will once taper down.
It could be a piquant situation – on one hand, rural consumption threatens to lose steam while urban consumption, thanks to the 7th Pay Commission could see some uptick. Thus what we lose due to poor rural consumption could, to some extent, be made up by the urban consumption.
No doubt, rural consumers today hold the key to the Indian economy. Apart from the harvest, social schemes like Mahatma Gandhi National Rural Employment Guarantee Scheme and others have provided employment to farmers during lean periods, helping them supplement this agriculture earnings. More than half of India’s stock of consumer durables and two-wheelers are now in rural India. Bikes, trucks, tractors and cars will see a spike up in demand. Also, rural India accounts for more than 40% consumption in major FMCG categories such as personal care, fabric care and hot beverages.
Every company, in the FMCG, auto, consumer durables, are all targeting aggressive marketing drive in rural India. And a rich harvest will surely means richer harvest for these companies. And this in turn means good fortune for those in the stock markets too. FIIs might be on a selling spree but we, those in the know of where the true money will now come in, should take a well informed long term buying decision.
Without agriculture, there would be no city, stock market, banks, university, temple or even an army. Agriculture is the foundation of civilization and a stable economy built on the edifice of bountiful rains.