• By Vivek Raj
  • Mon, 22 Jul 2024 04:14 PM (IST)
  • Source:JND

The Union Finance Ministry released the Economic Survey 2024 on Monday, a day before Finance Minister Nirmala Sitharaman is set to present her historic seventh Union Budget. The survey provides a comprehensive analysis of rising food prices for essential items such as tomatoes, onions, and milk across India and the overall economic landscape.

The Economic Survey revealed that global food inflation has been a major concern over the past two years. The survey highlights that food prices are increasingly influenced by climate change factors such as heat waves, irregular monsoon patterns, unseasonal rainfall, hailstorms, and severe droughts. These challenges have adversely affected agricultural output and contributed to rising food prices.

Food inflation, as measured by the Consumer Food Price Index (CFPI), rose from 3.8 per cent in FY22 to 6.6 per cent in FY23, and further to 7.5 per cent in FY24. This increase is attributed to several factors impacting agricultural productivity and food supply chains.

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Tomato Price Increase

According to the survey, vegetable and pulse production has been severely impacted by adverse weather conditions. In July 2023, tomato prices increased due to seasonal variations in crop production and region-specific crop diseases, including white fly infestations. The early monsoon rains in northern India and logistical disruptions caused by heavy rainfall in isolated regions further hiked the prices.

Onion Price Increase

The factors due to which the price of onions surged significantly include various factors as outlined by the economic survey. One of the contributing factors is that rainfall during the last harvesting season affected the quality of rabi onions. The other factors include - delays in sowing during the kharif season, dry spells impacting kharif production and trade-related measures imposed by other countries.

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Milk Price Increase

Milk prices have been increasing since early 2023, primarily due to reduced artificial inseminations during the pandemic and higher animal feed costs. In response, milk cooperatives raised the prices of milk and milk products. However, by the end of FY24, the rate of increase in milk prices moderated.

The Economic Survey also noted that the Indian economy has recovered and expanded steadily post-pandemic. The government projects a GDP growth of between 6.5 per cent and 7 per cent for the current financial year.