Poor monsoon could be the worst thing for market

IMD’s prediction could mean the government’s targeted GDP growth between 8 and 8.5 per cent for 2015-16 might be hard to achieve.

By: Express Web Desk | New Delhi | Updated: June 2, 2015 4:42 pm
A good monsoon would have ideal in the present market climate, but it seems there is no such luck headed India's way. A good monsoon would have been ideal in the present market climate, but it seems there is no such luck headed India’s way.

The prediction of a below par monsoon could have serious repercussions for the Indian economy. That is because India’s agriculture sector is still heavily dependent on the monsoon for irrigation.

IMD’s prediction could mean the government’s targeted GDP growth between 8 and 8.5 per cent for 2015-16 might be hard to achieve.

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Recently, ratings agency Crisil said a deficient monsoon would shave-off 50 basis points from its GDP forecast of 7.9 per cent for 2015-16. This comes as a major concern for the economy that is still suffering from drag in earnings growth, weak investment, consumption and relatively high interest rates.

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Add to this, the fact that rural demand has been weak for some time.

Also corporate investments have not really been picking up and consumption too has been weakening.

A good monsoon would have been ideal in the present market climate, but it seems there is no such luck headed India’s way.

The latest revision prediction comes on the back of concerns around El Nino — low rainfall in tropical pacific region due to abnormal warming in the eastern Pacific region and heavy rainfall in South America — that have been raised earlier.

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  1. M
    mohan
    Jun 2, 2015 at 5:29 pm
    Rain water harvesting through soil recharge is the only mechanism to deal with the unpreditable monsoon. Trees are essential for soil recharge. The first thing is to create an awareness among the general public about the importance of having trees and forests. The work done by Anna Hazare in the village of Ralegan Siddhi in Ahmednagar, towards rain harvesting systems, transformed it from a highly degraded village ecosystem to one of the richest in the country. The project is called as a sustainable model of environmental conservation. We should adopt this model in all villages
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