The economic situation in 1973 was governed solely by the impact of the 1972 drought The short-fall in agricultural, particularly foodgrains, output had all-pervasive repercussions on the economy. It led to a rise of 18.6 per cent in prices, accounted for mostly by the rise of 21 per cent in foodgrain prices. It led to a resumption, on commercial and barter terms, of foodgrain imports which strained the foreign exchange budget of the country.