The government on Wednesday announced a number of contingency measures to minimise the losses in agriculture and power sectors on the back of an expected deficiency in monsoon rains, to safeguard farmers' interest and keep prices under check.
Agriculture minister Radha Mohan Singh said a new crop insurance policy will be brought in to protect farmers' income.
On the other hand, the minister said, the government will take steps to improve domestic supplies through imports to check the price of pulses, which are already high.
Singh said the government is ready with contingency plans for 580 districts and is in touch with state governments and agriculture research bodies to tackle the situation.
With a delay in the onset of monsoon and fears of drought conditions hitting agricultural operations, stock markets have already taken a beating with the Sensex falling over 1,000 points in the past two days.
Firms with significant exposure to agriculture and rural markets are fearing significant business losses. The agriculture sector is already passing through a bad phase and any deficiency in rainfall may have an adverse effect on manufacturing and service sectors.
Singh said while there could be some losses in the agriculture sector, the government is confident that with policies in place, the damage to agriculture sector and overall economy would only be minimum.
Power minister Piyush Goyal also said that the contingency plans have been drawn up to meet any eventuality in case the deficient monsoon hits hydro power output.
"It's a matter of concern that the monsoon is expected to be below normal, deficient. We are conscious that this will result in a fall in hydropower production and the demand will also increase... The Ministry of Power and the Ministry of Coal are seized of the situation," Goyal said.
The minister, however, sought to allay concerns and said that adequate coal is available at every thermal plant in the country to meet any shortfall in hydro-power output.
The Met department has revised its rainfall forecast from 93 per cent to 88 per cent for this year, with north-west region of the country expected to be hit the most.
Last year, the country had received 12 per cent less rains, which hit production of grains, cotton and oilseeds.
According to the government's estimate, total foodgrain production has declined to 251.12 million tonnes in the 2014-15 crop year (July-June) from a record production of 265.04 million tonnes in the previous year.
The government has also ensured availability of urea in the country with the procurement of more than 1 million tonnes of imported urea in January 2015. Additional procurement of imported urea has been done in April, May and June 2015.
With increased domestic production by 1 million tonnes and reduction of demand due to introduction of 100 per cent neem coated urea, the availability position of urea is adequate and comfortable, official sources said.
The department of fertilizers along with the department of agriculture and cooperation is also regularly monitoring the stock position of fertilisers with the states in order to ensure adequate and timely supply to the farmers for the current Kharif season.