India’s June-September monsoon, the lifeblood of Asia’s third-largest economy, is likely to be “below normal” for the second year, the India Meteorological Department said on Wednesday, potentially toughening challenges for the Modi government already battling a farm crisis.
“The southwest monsoon rainfall will be 93% of a 50-year average of 89 centimetres,” minister for earth sciences Harsh Vardhan said, releasing the much-awaited official forecast.
According to the Met department’s classification, the monsoon is considered normal if falls are between 96% and 104% of the 50-year average of 89 cm (35 inch).
“There are very less chances of above normal rainfall,” Harsh Vardhan said, adding the forecast has been made after factoring the weather phenomenon of El Nino.
El Nino, meaning ‘little boy’ in Spanish, is caused by a warming of sea-surface temperatures in the Pacific, triggering dry spells in southeast Asia.
The rains are vital not only for agriculture and rural incomes but also the broader economy. Should the rains be patchy, industrial expansion tends to sputter too, since nearly half of most consumer items – from cars and TV sets to gold jewelry – are bought by the rural consumers.
A poor monsoon could also mean the Modi government would have to concentrate on mitigating its effects by pumping in more money, taking the focus of policymakers away from reforms.
Dipping farm incomes could leave the NDA government vulnerable to sharper Opposition attacks, especially from the Congress, already on battle mode over the controversial land acquisition bill.
The forecast of poor rains came on a day a farmer hanged himself in the Capital, signaling wider dissent among farmers suffering from weather shocks. A land-acquisition legislation that the Modi government wants to push through could only get tougher if the farm crisis worsens due to a truant monsoon.
The rain-bearing system, that typically begins its four-month journey across India on June 1 in Kerala, is also crucial for power, drinking and irrigation. A bad monsoon hits power production since hydropower accounts for a quarter of India's electricity output, critical for industry and households alike.
Drought-like conditions fan food prices, often worsening shortages of items such as pulses, onions and cooking oil.
An advanced government estimate of winter output made before the recent unseasonal rains had already projected a 2.6% decline due to effects of a late drought. A poor monsoon could further trim harvest of major crops, such as rice and soya bean, pushing up food prices.
According to the Met department’s simulation, which was not part of the official monsoon forecast, drier conditions are set to be more acute in the grain-bowl northwest and central India, compared to the south and northeast.
A series of storms this winter have devastated around 10.7mn hectares, which comprises about 18% of the total winter crop area sown.
The government has stockpiles of staples such as rice, wheat and sugar from bumper harvests in the last few years but it has limited means to control a jump in costs of fruits and vegetables that have the largest impact on food inflation in India.
Higher inflation could make it difficult for the central bank to cut interest rates further to boost investments needed to create jobs for some 10 million young Indians joining the workforce every year.
Also, lower output of cereals would mean the government will have to spend on costly imports to maintain the grains buffer.