On July 14, 2025 i.e. Monday, common people got double happiness. Where there was a big decline in wholesale inflation. The figures of retail inflation that then doubled this happiness. When both types of inflation figures were seen, there has been a big decline in food inflation. Food inflation in both has reached minus. Now the biggest question is whether the Rural Economy will be damaged by the food inflation going to the minus? Has inflation has not become enemies for farmers?
There is also a reason for that. When food inflation continues to decrease, farmers will get low price. If the price is low, then the income of the farmers will be reduced and due to the low income, the rural economy will get a shock. By the way, experts say that the monsoon, MSP and exports can increase the growth of the agricultural sector, which will also benefit the economy, but it will not last long term. Let us also tell you how the decreased inflation figures have become enemies of farmers?
Be it wholesale or retail, both types of food inflation figures have been seen in minus. First talk about wholesale inflation, according to the statement, the main reason for the decrease in inflation in June, 2025 was soft in the prices of foods, mineral oils, manufacturing of original metals, raw petroleum and natural gas etc. According to the bulk inflation data, the prices of food items declined by 3.75 percent in June as compared to 1.56 percent in May. The prices of vegetables also recorded a huge decline. In June, the prices of vegetables decreased by 22.65 percent. In May, the inflation rate of vegetables declined by 21.62 percent. According to government data, the food price index has come to -0.26 percent, which was 1.72 percent in May.
At the same time, there has been a big decline in food inflation in the figures of retail inflation in the evening. Looking at the data, it declined to -1.06 percent in June, which was 0.99 percent in May. This decline was mainly due to favorable base effects and low prices in major categories such as vegetables, pulses, meat and fish, grains, sugar, milk and spices. If we look at the data, it is known that inflation for rural and urban areas is -0.92 percent and -1.22 percent respectively. According to the report, in June 2025, food inflation has been the lowest after January 2019. In this way, you can guess that the data of food inflation has been a big hand behind the reduction of retail inflation. Due to which inflation in rural areas of the country has come to -0.92 percent.
If we talk about the states, then in two states of South, the statistics of rural inflation are being seen in minus. Talking about the data, rural inflation in Andhra Pradesh has come to -0.55 percent. Whereas in Telangana, rural inflation has been seen at -1.54 percent. The special thing is that there is a lot of farming in both the states. The economy of both states is very dependent on farming. At present, the monsoon situation is much better. Due to which production is being estimated to improve in cultivated states. The effect of which is seen to be reflected in inflation figures. Many states of the south have received good rainfall in the months of June.
Now the biggest question is whether farmers' earnings can be reduced due to reduced food inflation? According to experts, the production cost has increased considerably in the agricultural sector at present. Due to which the product producing farming has also become very expensive. If inflation is less and farmers do not get the right price for their farming, then there is a lot of impact in the income of farmers. Meaning farmers' earnings decreases. Ajay Kedia, an expert in Mumbai based commodity sector, says that farmers do not get the right price from the market due to low inflation. Due to which farmers often have to sell at a lower price than the production cost.
Ajay Kedia says that many people can question this in the name of MSP. But the biggest question is that how much percentage of farmers are purchased on MSP. Whose volume is very low. The rest of the production has to be sold in the open market. Due to low prices, farmers do not get that price of their farming, as much as they want. He said that an increase in MSP, better monsoon and XOT can succeed in short term in boosting the agri sector, but it will not work in the longater.
Even if the production can increase due to better monsoon. But due to low earnings of farmers, a lot of effect can be seen on rural economy. By the way, according to the recent "Rural India - Changing Economic basis" topic report of HDFC Securities, the rural economy is now taking a new look by the service sector. A new report of HDFC Securities shows that 112 rural districts with 29.1 crore people have crossed the per capita income limit $ 2,000-this is a milestone that indicates increasing prosperity and consumer capacity.
This report presents an intensive analysis of 250 districts in eight major states, which is 72 per cent of the rural gross domestic product (Rs 109 lakh crore) of India. This shows that rural areas are not only gaining momentum - they are also giving momentum to India's consumption engine, especially when urban demand remains slow under inflation. These notable districts include Karnataka's Namakkal in South Kannada and Tamil Nadu, where per capita income has crossed $ 5,000, which has a strong contribution of manufacturing, livestock, aquatic agriculture and real estate.
