Mumbai: In addition to tomato and onion, tur dal has contributed to India’s food inflation which has remained high over the past two years, said the Economic Survey 2024-25 released on Thursday. The Survey attributed the price increase to supply chain disruptions exacerbated by extreme weather events and reduced harvest of some food items and called for focused research to develop climate-resilient crop varieties, enhancing yield and reducing crop damage. Over the past decade, there has been a strong negative correlation (-0.8) between the annual inflation rate and the 1-year lagged production, indicating that lower production in one year typically results in higher inflation in the following year.“When we exclude the three most price-sensitive vegetables (tomato, onion and potato (TOP)) from the CPI basket, the average food inflation rate in FY25 (April-December) was 6.5 per cent, which is 1.9 per cent lower than the current food inflation. Similarly, average headline inflation is 4.2 per cent when excluding TOP, which is 0.7 per cent lower than the current headline inflation,” said the Survey. The Survey also blamed the deficient production of tur dal in 2022-23 and 2023-24 which led to high price pressures in tur dal during FY24 and FY25 (April-December), despite various measures by the government to shore up the supply in consuming regions. Production declined by 13.6 per cent in 2022-23 and 10.8 per cent in 2023-24 compared to the last 5-year average, affecting the supply said the Survey. As a major Kharif pulse, tur is harvested from November to January, with its price impact mainly observed in the subsequent financial year.The Food inflation, measured by the Consumer Food Price Index (CFPI), faced pressures in FY25 (April-December), primarily driven by a few food items such as vegetables and pulses. Vegetables and pulses together holds a total weightage of 8.42 per cent in CPI basket. However, their contribution to the overall inflation stood at 32.3 per cent in FY25 (April to December).Led by a good Rabi harvest, India’s inflation is likely to ease in the fourth quarter of the current financial year, aligning with the RBI and IMF target of around 4% by FY26.
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