The advance estimates of national accounts project overall growth of GDP at 4.9 per cent in 2013–14, higher than the 4.5 per cent growth estimated in the previous year. While overall economic growth remained low in agriculture and allied sectors registered a sharp improvement in output. Favourable monsoon rainfall helped to improve agricultural sector’s production prospects. Although excess rainfall towards the end of monsoon period in some of the eastern and central India led to crop damage, the late rains helped improve prospects of the rabi crops with reported increases in sown area of the rabi crops. In fact, nearly all the estimated increase in foodgrain output in 2013–14, as per the 2nd Advance Estimates (AE) of the Ministry of Agriculture is in the rabi season.

The report also provides an assessment based on rainfall data and trend growth in output of food commodities. As the official estimates are still subject to further revisions based on the new data, we have provided these estimates for a comparison as the model based estimates are valuable when they are obtained before the final estimates are available. As a result of higher crop production, the year also saw deceleration in overall inflation rate and food inflation especially towards the end of 2013. International market prices have remained stable and lower in 2013 as compared to the previous year in a number of commodities. Although lower prices reflect adequate supplies to meet the global requirements at the present levels of consumption, they also point to the need for more competitive production of commodities to benefit from export demand. The exchange rate depreciation provided some cushion to exports, but they also raise the cost of imported inputs and food commodities such as edible oils.

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