Will India really have a normal monsoon in 2012?

The Indian Meteorological Department’s forecast of normal monsoon this year has brought cheer to ordinary investors, businesses and consumers. Good rains will mean good farm output and steady incomes for farmers. That, in turn, will help consumer spending.

So many hopes are, therefore, based on that one prediction by the Met. But should we really believe it? After all, it doesn’t have a sterling track record on accurate forecasts.In fact, interestingly enough, some global weather agencies, which have better expertise and whose predictions have turned out in the past to be reliable, have actually predicted a below-normal monsoon for India.

Not surprisingly, not many experts are willing to embrace IMD’s forecasts wholeheartedly.

Ashok Gulati, chairman, Commission for Agriculture Costs and Prices (CACP), for instance, says IMD’s prediction “should be taken with a pinch of salt”. In an interview to Business Standard , Gulati says that although he wishes that IMD’s predictions come true, past data shows there is usually a ‘deviation of 8-10 percent from the standard margin of error’ in many Met predictions.

These are the reasons why he believe India may not have ’normal monsoon’ this year:

Gulati says that the Met office’s forecast of a normal monsoon this year is 47 percent. That is to say, the possibility of normal monsoon is not even half.

There are also worrying signs of the emergence of the El Nino phenomenon in the Pacific, which is historically associated with a weak monsoon, reported Deccan Herald .

A longer-than-expected winter also tends to mean that the monsoon will be erratic. Since 2011 experienced a long winter, it’s very likely that an erratic monsoon may be totally possible in 2012, says Gulati.

Reservations about the IMD’s optimism also arise from its poor history of reliable predictions. It failed to forecast the droughts of 2004 and 2009, years when it predicted a normal monsoon. It has also not been able to correctly predict the temporal and spatial distribution of rainfall.

So that brings us to the question: Is India prepared for bad monsoons?“For wheat and rice, we don’t have any problem. But he real impact would be felt on coarse cereals, pulses, oilseeds and cotton”, says Gulati.

The bigger challenge would be to control prices of commodities. Gulati says that price pressures would develop in edible oils, imports would have to rise, and pulses could become costly if output drops.

Since India is largely an agricultural country, and still heavily dependent on monsoons, good and timely rains are critical for economic growth.Despite the IMD’s predictions, whether that happens is still very much up in the air.