With good monsoon this season, the country expects the grain production during the 2010-11 crop year to touch, or even exceed, the last best level of 2008. Grain production during 2008-09 was 234.47 million tonnes. During 2009-10, the output is expected to be about 218 million tonnes.

Except parts of Bihar, Jharkhand, West Bengal, Madhya Pradesh and Uttar Pradesh, the monsoon spread has averaged out at “plus three per cent,” to the government's “satisfaction.” Rainfall deficit is 25 per cent in Bihar, 48 per cent in Jharkhand and 16 per cent in West Bengal. It is also deficient in parts of Madhya Pradesh and Uttar Pradesh.

In the drought-hit districts of Bihar, Jharkhand and West Bengal, the Centre will provide farmers with a diesel subsidy of Rs. 500 each to enable them to power their pump-sets.

For this, the government has set aside Rs.500 crore. The government will seek the Election Commission's permission to implement the decision, Union Agriculture Minister Sharad Pawar told journalists here on Friday after inaugurating the conference on the rabi campaign.

Since Bihar is going to the polls from October 21, the model code of conduct has come into force.

“I met Finance Minister Pranab Mukherjee on Thursday, and it was decided to extend diesel subsidy to farmers in these States so that they can salvage their crops. The government has decided to give Rs. 500 crore for this. The entire sum will be borne by the Central government.”

Mr. Pawar said though the kharif rice output suffered a setback last year because of the drought in 399 districts, grain production was expected to be better and reach or exceed the 2008 level next year. “I expect overall grain production to reach between 220 million tonnes and 230 million tonnes because of the good monsoon. The area under pulses, oilseeds, cotton, sugarcane and paddy is more than what it was last year.”

Sugar production is expected to be 23 million tonnes against 18.8 million tonnes in the current year ending September 30.

“The good southwest monsoon will be favourable to the wheat crop next year. The reservoirs are full; the storage in the Bhakra dam, for instance, has not been like this in the past 30 years. Our expectation is that 2010-11 will be a bumper crop year,” Mr. Pawar said.

Reiterating the government's resolve to enhance the grain storage capacity, Mr. Pawar ruled out lifting the ban on wheat and sugar export “till a final view is taken on the National Food Security Bill.”

Asked about permitting futures trading in sugar from October 1, as the Forward Markets Commission has hinted recently, Mr. Pawar said: “They suspended sugar futures. It is up to them to take a decision on allowing it.”

The Ministry moved a proposal to de-control the sugar industry, and it was holding consultations with the States, as agriculture is a State subject.

Asked to comment on reports that floods-ravaged Pakistan might accept food aid, rather than financial aid, from India, Mr. Pawar said any decision would have to be made by the Prime Minister. “If there is a request from the Ministry of External Affairs, we will be happy to process it, be it for Pakistan, Sri Lanka or Bangladesh.”