DARK clouds, which should normally have covered vast parts of peninsular India by the second week of June, are unfortunately not to be seen over the skies. Instead, they are metaphorically hovering over the economic horizon, threatening to derail the gains of the past few months.

Last week, finance minister Arun Jaitely hurriedly summoned a meeting of top ministers and bureaucrats — including those handling agriculture, food, transport, commerce and urban development — to tackle the mini crisis that has engulfed the economy.

The meeting was held following the release of data relating to inflation. While the wholesale price index (WPI) inflation was up at 0.79pc in May, consumer price index (CPI) inflation expanded at 7.55pc, hitting a 21-month high.

Worse, vegetable prices were up by a hefty 13pc and pulses inflation was at a shocking 36pc, reflecting the appalling lack of coordination within the government and between the centre and the states.

Strangely, India has not been able to tackle the problem of high pulses inflation for years. Despite a growing demand-supply gap, politicians and bureaucrats have failed to take timely and necessary steps to ensure adequate supplies of pulses.

The result: dal prices had skyrocketed to Rs170/kg last week, and policymakers were merely talking about importing them from Africa and neighbouring Myanmar. The crisis on the lentils front is not something that should have taken the government by surprise as it has been building up for several months.

Food minister Ram Vilas Paswan decided to send a team to Myanmar and some countries in Africa to arrange for imports of pulses. But clearly, the government has failed badly on the pulses front and will apparently end up paying a hefty political price.

Last October, one of the reasons the BJP lost elections in Bihar was the high price of dal. The government apparently has not learnt the lessons from Bihar. Last year, India imported 5.5m tonnes of pulses. In the current crop year (July 2015 to June 2016), estimated production has been placed at about 17m tonnes, whereas demand is at 23.5m tonnes.

Yet, the government — and its agencies — has been blissfully ignoring the huge gap; instead of going in for bulk imports, it has been buying in small quantities of a few thousand tonnes. The government also decided to build a buffer stock of a mere 150,000 tonnes and managed to procure just 115,000 tonnes, which is totally inadequate to meet the country’s growing needs for pulses.

The government now wants to sell pulses from the buffer stock through state-owned retail chains at a price of around Rs120/kg, which is also unaffordable for most Indians.

Even in the face of a grim and snowballing crisis, ministers and senior bureaucrats are acting in a lackadaisical matter, failing to adopt a long-term strategy.

But it is not just the price of pulses that have skyrocketed. Vegetables have become prohibitively expensive. The ordinary tomato was being sold in Mumbai and other major cities at over Rs100/kg last week, more than double the price of a few weeks ago.

Potato prices were also on the rise, so too were the prices of most vegetables. After two years of back-to-back drought, it should have been apparent for the authorities that food prices would soar.

Most parts of India, especially states where rain-fed rivers sustain agriculture, are reeling under the impact of the severe drought, yet timely measures were not taken to alleviate the situation.

THE delayed onset of the south-west monsoon is also causing a lot of consternation. The India Meteorological Department (IMD), which is only now considering replacing a nearly century-old statistical model of forecasting the rains with a sophisticated super-computer, appears to have got its predictions wrong even this year.

The IMD has forecast that the season’s rainfall will be 106pc of the long period average. However, the met office has been revising its predictions frequently as the monsoon got delayed by more than 10 days. Even now, most parts of central India and the western coast (including states of Goa and Maharashtra) have hardly been getting rains.

For the first fortnight of June, there was an overall deficiency of 22pc for the country, which received 43.6mm of rainfall (as against a normal of 55.7mm). The acute scarcity of drinking water in states such as Maharashtra and Karnataka and record temperatures in the north are worsening by the day.

And in view of the unreliable predictions by the met office (even private weather forecasters have failed miserably), farmers are unable to plan their strategies for sowing seeds and are wary of the forecasts, which have often flopped in recent years.

The volatility in agricultural commodities, caused by ham-handed policies including arbitrary imposition of bans on imports and exports has led to uncertainties in the farm sector.

Onion prices, for instance, which fluctuate wildly, have collapsed. Farmers were desperately selling the bulbs in Maharashtra, one of the largest producers of onion, at prices as low as Rs375 a quintal, almost a fourth of the prices fetched a few months ago.

Farmers have started protesting in western Maharashtra and have demanded a minimum support price (MSP) of an unrealistic Rs2,000 a quintal. They are also demanding a complete loan waiver, which will cripple funding in the future.

There are sharp differences between the government, farmers, traders and experts on the fate of other agri commodities as well. For instance, traders expect a 10m fall in wheat production and are preparing to import the grain, but government officials are confident that there would be no shortfall.

Sugarcane production is also likely to be affected in Maharashtra, one of the largest producers of cane, because of the severe drought of the past two years. Elections in Uttar Pradesh — another major cane-growing state — next year will also have its impact on cane prices and on sugar.

However, instead of planning for the future, decision-makers in the government are busy in fire-fighting operations and are not inclined to prepare strategies for different agricultural products.

Published in Dawn, Business & Finance weekly, June 20th, 2016