One Quarter of India Faces Drought Threat

In India, a deficit in annual monsoon rains has left nearly one-quarter of the country facing the prospect of a drought. The government is taking measures to stave off food shortages, but fears are growing that the poor monsoon will adversely impact economic growth.

For more than two months, farmers across India have been waiting for annual monsoon rains to drench parched fields so that they can sow crops such as rice, sugar and oilseeds.

But many have waited in vain, as rains have been elusive in large parts of the country, since the monsoon season began in June.

Finance Minister Pranab Mukherjee said Tuesday that nearly one-quarter of the country faces the threat of drought. He says the area cultivated with Summer crops is down by 20 percent, compared to last year.

Less than half of India's farmland is irrigated.

Mukherjee says the government can manage the situation and that a contingency plan is in place.

"About 161 districts already have been declared drought prone," Mukherjee said. "This country has the experience, capability of handling the situation, and I will advise not to press the panic button."

The government says surplus harvests in the last two years mean they have sufficient stocks of food grain to distribute through drought-affected areas.

The government is also taking steps to import food items such as sugar and lentils, which could be in short supply.

Food prices are already climbing. But the prime minister says the government will ensure than no citizen goes hungry.

The areas affected by drought include some of the country's most populous and poor states, such as Bihar, Uttar Pradesh and Andhra Pradesh.

Economists have warned that the deficit in farm production will hurt rural incomes and pull down economic growth in the country at a time when hopes were growing that India was puling out of the slump which followed the global recession.

However, Mukherjee hopes that India's growth will not be hurt.

"What would happen [we] shall have to accept," Mukherjee said. "But Reserve Bank's latest assessment is it would be six plus [percent]. I am still sticking to that."

The agriculture sector is vital in India because it sustains nearly two-thirds of the country's more than one billion population.