Drought might impact GDP growth

Drought may be a natural disaster of below-average precipitation during a given region, leading to prolonged shortages within the water system, whether atmospheric, surface water, or groundwater. A drought can last for months or years or even be declared after as few as 15 days. It can have a considerable impact on the ecosystem and agriculture of the affected region and harm the local economy. Annual dry seasons within the tropics significantly increase the probabilities of a drought developing and subsequent bush fires. Periods of warmth can significantly worsen drought conditions by hastening the evaporation of water vapour.

What is Inflation

Inflation is a steady increase in the overall price level of goods and services in a given economy. It corresponds to a decrease in the purchasing power of a currency used in the economy. As a result, more currency units are required to purchase the same goods and services. Whether food, toothpaste, rent, or medical services, your money buys you less.

Inflation in India 

According to the Indian Ministry of Statistics and Programme Implementation, India’s inflation rate was 5.5 per cent in May 2019. This is a slight decrease from the previous annual result of 9.6 per cent in June 2011. For all commodities, inflation rates in India are commonly expressed as changes in the Wholesale Price Index (WPI).

The consumer price index (CPI) is widely used as the primary indicator of inflation in many developing countries. The CPI (combined) has been named the new standard for calculating inflation in India (April 2014). CPI data is normally collected monthly and with a large lag, making it inappropriate for policymaking. Changes in the CPI are used to calculate India’s inflation rate. Primary Articles (22.62 per cent of total weight), Fuel and Power (13.15 percent), and Manufactured Products (13.15 per cent) make up this basket in India (64.23 per cent). The weight of food articles from the Primary Articles Group is 15.26% of the overall weight. Food products (19.12 percent); chemicals and chemical products (12 percent); basic metals, alloys, and metal products (10.8 percent); machinery and machine tools (8.9 percent); textiles (7.3 percent); and transportation, equipment, and parts (7.3 per cent) are the most important components of the Manufactured Products Group (5.2 per cent).

Causes of Drought 

1. Natural causes

Droughts have occurred naturally in the past, afflicting humanity for much of its existence. Droughts were once thought to be a natural occurrence caused by cyclical weather patterns, such as the amount of moisture and warmth in the air, land, and sea.

2. Weather patterns that have changed

The way air travels through the atmosphere can also affect rainfall distribution around the earth. Air circulation patterns are disrupted when surface temperatures are abnormally high, especially over the ocean.

3. Excessive water usage

Drought can also be caused by an imbalance in water supply and demand. More water is needed to maintain humans because the global human population continues to grow, and intensive agricultural practices are still in use.

4. Deforestation and soil degradation

Trees and plants are important as they release moisture to the atmosphere, leading to clouds forming and rainfall falling, returning the moisture to the bottom. Unfortunately, humanity is the best at destroying these natural resources.

5. Heating 

As the name suggests, the earth is being warmed at alarming rates, resulting in droughts. Heating is usually related to acting by releasing greenhouse gases which cause a trapping effect, causing global temperatures to rise.

Impact of drought on GDP

When we have a drought, it can have various effects on our communities and surroundings. Everything in the environment is interconnected, just as everything in our communities is. The various ways drought impacts us are referred to as drought impressions.

Drought has a wide range of effects on our lives since water is an important component of so many of our activities. Water is a measure of our basic requirements, and animals and plants require it. Water is required to grow the food we consume. We also use water for various purposes in our daily lives, such as dishwashing, cooking, bathing, swimming, or river rafting. Water also wants to contribute to creating the electricity we use to power our houses’ lights and, as a result, the video games you’ll want to play. Many of us and many different things will be affected in many different ways if we don’t have enough water for these activities due to drought. Drought has an economic impact when it causes people to lose money (or businesses).

Examples Of The Impact Of Drought The On Economy 

• Farmers may lose money if a drought destroys their crops.
• If a farmer’s water system is just too low, the farmer may need to spend extra money on irrigation or drill new wells.
• Ranchers may need to spend extra money on feed and water for their animals.
• Businesses that depend upon farming, like companies that make tractors and food, may lose business when drought damages crops or livestock.
• People who add to the timber industry could also be affected when wildfires destroy timber stands.
• Businesses that sell boats and fishing equipment might not be ready to sell a number of their goods because drought has dried up lakes and other water sources.
• Suppose the drought dries up a large portion of the water system. In that case, power firms that rely on hydroelectric power (electricity generated from the energy of flowing water) may have to spend more money on other fuel sources. Customers of facilities firms would have to pay much more.
• Water firms may need to invest in the new or expanded water supply.
• Due to low tide levels, barges and ships may have trouble navigating streams, rivers, and canals, which could hamper businesses that rely on water transportation to receive or convey goods and commodities.
• People may have to pay a higher price for groceries.

Conclusion 

We can conclude that drought impacts include farmers who lose money because drought destroyed their crops or ranchers who may need to spend extra money to feed and water their animals. Economic impacts are often direct, like decreases in dairy production, and indirect, as seen by increases in the price of various products produced by the farmers.