It is a little too early to cheer the India Meteorological Department’s (IMD’s) early-stage forecast of a normal South-West monsoon this year. Experience over the last decade suggests that the actual quantum of rains can vary widely from this forecast. IMD’s April forecasts had projected a normal monsoon (quantum of rainfall at 4 per cent plus or minus long-period average or LPA) in eight of the last ten years, but the decade saw four excess monsoon years and three below-normal/deficient years.
The early forecast can be a particularly inaccurate predictor of monsoon behaviour in years where El Nino is a factor. In 2014 and 2015, a brewing El Nino diminished rains to 88 and 86 per cent of the LPA while IMD had predicted 95 and 93 per cent respectively. The Australian Bureau of Meteorology recently pegged the probability of an El Nino developing this year at twice the usual levels, and has warned that it will likely develop by August. The IMD has cited Indian Ocean Dipole conditions and low snow cover in the Northern Hemisphere as possible mitigants to El Nino. But as El Nino has led to sub-par monsoons for India on 10 out of 15 occasions in the past, it is a variable that needs watching.
More than the aggregate quantum of rainfall showered by the South-West monsoon, it is the spatial and temporal spread of rains that is crucial to India’s agricultural prospects and inflation outlook. Last year, though the monsoon helped by a La Nina lavished rainfall at 106 per cent of LPA, deficient rains in the key growing regions of Uttar Pradesh, West Bengal and Bihar led to significant shortfalls in kharif sowing. Excess rains in October from a late-staying monsoon also inflicted damage on the standing crops of soyabean, cotton, pulses and paddy. For the current year, IMD expects the Southern peninsula, East Central India and the Northeast to receive normal or above-normal rains, while Northern and Western India (Gujarat, Maharashtra, Telangana and Haryana) are expected to see patchy rains. This could have implications for rice, oilseed and sugarcane output. As IMD’s forecasts on spatial distribution have proved spot on in recent years, policymakers would do well to prepare farmers in these specific States and crops well in advance. In terms of temporal spread, farmers have become accustomed to adjusting their sowing patterns to early and late onset monsoons. But deficient rains in the crucial growing months of July and August prove quite damaging to crop prospects. A late-developing El Nino will aggravate this risk.
The above factors are reasons why mandarins of the Agriculture and Consumer Affairs ministries need to keep a close eye on IMD’s monthly forecasts and nowcasts, as the monsoon progresses. The Centre needs to work on improving the reliability of its agricultural output estimates to avoid knee-jerk policy interventions on agri-commodities that compromise farmer interests, when sudden supply shortfalls stoke CPI inflation. The Monetary Policy Committee, which has predicated its recent rate pause on cooling inflation, may also need to closely monitor the monsoon’s progress to decide on its future course of action.