Media, (Lalit) Modi, Meteo, Monsoon and MSP

The Indian media is entranced by the Lalit Modi – Vasundara Raje – Sushma Swaraj – P. Chidambaram Saga. Frankly, the issues strike a disinterested observer as somewhat lame – no patch on the UPA’s deeds of commission and omission and corruption. But, for vast sections of Indian media, anything to embarrass the other Modi with is an opportunity not to be wasted. That is a pity. In the process, they are missing out on some of the good things that the government is doing. For the sake of the country, they need to focus on the right issues. Couple of op.-eds here for your reading pleasure.

Very few of them, if at all, were exercised by the International Labour Organisation, a U.N. body, doing this. This is far more harmful for the country than the favours that the External Affairs Minister might have rendered Lalit Modi. The media has the wrong priorities, from the national interest perspective, that is. At a personal level, they may well have their priorities very clear. That has always been India’s bane, throughout history.

In the meantime, in the first two weeks of the monsoon season, rains have exceeded expectations throughout the country, taken as a whole. Unfazed, the Indian Meteorological Department predicts (this link will keep changing every week – the link here is for June 18 press release) a disappointing July. That might ‘gladden’ the hearts of those who have been ‘disappointed’ that rain gods have been generous so far. But, one should not forget the overall forecasting record of IMD with respect to monsoons. It is not a criticism. Predicting monsoons over a three-month window is not that easy or so, I guess.

Rain gods have been generous and hence, the Government of India could afford to be parsimonious. That is what it did.

On 17 June, when the Government of India announced its policy of agricultural produce procurement, it elicited the following comment from the economist Z. Chinoy of JP Morgan:

 To its credit, the government resisted any such pressures and support prices for paddy – the main crop that the government procures in this season — were only increased by 3.7%, in line with last year’s increase and less than half the 10% average that existed for the three previous years…..

…. Those caveats apart, the government deserves enormous credit for today’s move. It signifies that authorities are acutely aware that MSPs are blunt instruments to react to rural stress or a monsoon shortfall. Furthermore, it suggests the government is far more willing to use targeted interventions (NREGA which has a self-selection component, and crop insurance) to counter any drag on agricultural production from a monsoon shortfall. More generally, it underscores the government’s commitment to keeping food inflation in check and persisting with macroeconomic orthodoxy even under populist pressure.

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