Furthermore, it mentioned the agricultural family incomes have stayed resilient within the face of the COVID-19 pandemic and have been supported by wholesome farm money flows throughout areas, aided by excessive ranges of rabi procurement below numerous authorities schemes after a season of bumper harvest.
Additional, elevated authorities help by means of schemes like MNREGA and PM-KISAN have helped in creating employment and easing liquidity strain on rural incomes, led to by massive scale reverse migration from city to rural areas publish the imposition of the nationwide lockdown, it added.
“Whereas the sudden imposition of nationwide lockdown had led to fears of disruption within the Rabi procurement course of, the identical was mitigated by immediate lifting of restrictions by the federal government for agricultural actions.
“This, together with important improve in spending on social welfare schemes in the course of the first quarter of FY21 helped in absorbing the surplus labour availability in rural areas created by reverse migration,” the rankings company’s Vice President Shamsher Dewan mentioned.
Additional, well timed and wholesome monsoon rain throughout areas and labour availability has supported early kharif sowing with its acreage at document highs in the course of the present 12 months, the report added.
The identical is more likely to lead to a wholesome harvest for many kharif crops, subsequently, protecting the farm sentiments up, it mentioned.
However the chance of COVID-19 spreading in rural areas, Icra expects the farm sentiments to stay wholesome over the subsequent few months supported by beneficial reservoir ranges.
It mentioned agriculture revenue is more likely to profit over the medium time period aided by elevated authorities deal with rural revenue in addition to the just lately launched farm reforms, that are able to creating elevated worth within the sector.
Farmers would probably profit from improved worth discovery for his or her produce, stability introduced by long-term contracts with corporates in addition to elevated funding in agriculture infrastructure by the non-public sector over the medium-term, the report added.
“Varied excessive frequency sentiment indicators together with fertiliser gross sales and tractor retail gross sales are pointing in the direction of continued wholesome demand in rural areas. Meals costs have additionally remained at excessive ranges which typically is a constructive for the farmers.
“With reservoir ranges being beneficial, there are expectations of a great Rabi sowing over the subsequent few months which might additional prolong the upbeat sentiments in rural India. Nonetheless, decrease than common reservoir ranges in north India – a significant contributor of Rabi manufacturing, might be a potential dampener,” Dewan added.