India could see a normal rainfall this year. On Tuesday science and technology minister Pawan Kumar Bansal revealed the government’s expectations from the annual monsoon. He said the met department’s long-range forecast for the south-west monsoon was that it would be normal. More specifically, he announced rainfall in the June to September period would be 98% of the long-period average. That number comes with an error margin of plus or minus 5%.
Monsoons account for 80% of all of India’s rainfall and it’s the primary source of water for most of India’s farms.
There’s another good sign for the economy. Revised figures show the country’s merchandise exports grew 37.5% in the year ending March to $245.9 billion. Commerce minister Anand Sharma pointed out that it was much higher than the government’s target of $200 billion. Sharma added that engineering goods drove the growth. The sector grew 84.8% during the year to $60.1 billion.
A healthy monsoon could help India’s economy, but some loans are going to get more expensive. State Bank of India hiked its lending rates on Tuesday. Its base rate is up 25 basis points to 8.5%. And its benchmark prime lending rate is also up by 25 points to 13.25%. The base rate is the lowest rate that a bank can charge for loans. SBI is now the first bank to make loans more costly since the Reserve Bank hiked policy rates in March.
In corporate, Vedanta has taken its first step towards getting a controlling stake in Cairn India. Its subsidiary Sesa Goa has purchased an 10.4% stake in the company from Malaysia’s Petronas. The deal is worth Rs6,620 crore. Meanwhile Sesa Goa has hastened to clarify its stake buy is not part of the open offer for Cairn India. The firm launched an open offer for 20% of Cairn India earlier this month.