Indian GDP - difficult to put 2 and 2 together
India's Q2 FY'10 GDP number released some time back surprised me on the upside. However, I was not quite convinced about the data.
Firstly, the government appeared to be too optimistic about the agricultural sector, strangely assuming that the agriculture growth rate in the quarter will be about 0.9%. However, in a year when the monsoon deficit has been 23%, the highest since 1972, and when drought has been declared in 299 districts during the monsoon itself (a record by itself), there seems to be an anomaly. Let’s look at what history has to say with regard to how the foodgrain production in particular and the agriculture sector in general was affected when monsoon played truant with India.
For this I looked at the agricultural performance data from 1970-71 till date and looked at how the performance panned out during periods of deficit rainfall. It is important to note that prior to the deficient rainfall experienced this year, there were 4 years when the rainfall was deificent by about 20% and above. Virtually during all these years, there was a massive drop in agricultural performance.
| Period | Gr. rate in agri | Gr. rate in foodgrain pdn | Rainfall deficit |
| 1970-71 | 7.1% | 9.0% | |
| 1971-72 | -1.9% | -3.0% | |
| 1972-73 | -5.0% | -7.7% | 24% |
| 1973-74 | 7.2% | 7.9% | |
| 1974-75 | -1.5% | -4.6% | |
| 1975-76 | 12.9% | 21.2% | |
| 1976-77 | -5.8% | -8.1% | |
| 1977-78 | 10.0% | 13.7% | |
| 1978-79 | 2.3% | 4.3% | |
| 1979-80 | -12.8% | -16.8% | 19% |
| 1980-81 | 12.9% | 18.1% | |
| 1981-82 | 4.6% | 2.9% | |
| 1982-83 | -0.3% | -2.8% | |
| 1983-84 | 10.1% | 17.6% | |
| 1984-85 | 1.6% | -4.5% | |
| 1985-86 | 0.3% | 3.4% | |
| 1986-87 | -0.4% | -4.7% | |
| 1987-88 | -1.6% | -2.1% | 19% |
| 1988-89 | 15.6% | 21.1% | |
| 1989-90 | 1.2% | 0.7% | |
| 1990-91 | 4.0% | 3.1% | |
| 1991-92 | -2.0% | -4.5% | |
| 1992-93 | 6.7% | 6.6% | |
| 1993-94 | 3.3% | 2.7% | |
| 1994-95 | 4.7% | 3.9% | |
| 1995-96 | -0.7% | -5.8% | |
| 1996-97 |
