Why The Monsoon Is The Biggest Factor In The South Asian Economy

Adam Taylor, Samuel Blackstone
Bangladesh children

This year, India’s monsoon season was four days late. Four long, stressful, anxious days.

Finally, on June 5th, India’s Meteorological Department made the announcement all had been waiting for: the monsoons were here.

The monsoon is vital to India, this year even more so than usual, given recent fears about the country’s economy.

But the monsoon also affects other economies in the region, and, frankly, the entire world.

Generally the Summer monsoon season in South Asia begins in mid-May and ends in late October/early November.

While the South Asian monsoon is best known in India, it also affects Pakistan, Thailand, Bangladesh, Myanmar, Laos, Vietnam, Cambodia, the Philippines, and Malaysia.

In India, however, it can be incredibly important. Some 80% of India's rainfall falls during the monsoon.

Source: The National (UAE)

And that's a big deal when Indian farming sector is worth more than 15% of the economy.

For the rural population, monsoons and the resulting harvest are what they depend on for both income and food. Currently, more than two thirds of India's 1.2 billion people work in agriculture, according to the 2011 CIA Factbook.

And 50% of crops remain rain-fed due to a poor irrigation system.

Source: Business Standard

Government spending in India is heavily dependent on the monsoon.

With the increase in individual income from a successful harvest, government can spend less on public assistance programs including welfare and subsidies on things like fuel. Power is also generated from the monsoons, with the water power from the rains being converted into electricity.

Even gold prices depend on the monsoon, as half of India's gold buyers are rural workers.

Source: The Economic Times

Unfortunately, the science behind the monsoons is simple but hard to predict.

As the summer begins, landmasses heat at a faster rate than the Indian Ocean, causing the air above the land to become warmer than the air above the ocean. The cooler, moisture-filled ocean air begins to move towards the warm, lower pressure air above the landmass. Once the low and high pressure fronts converge, moisture within the air lets loose a fury of rain.

There are actually two monsoon seasons in South Asia.

Following the summer monsoons, when rain is dumped on the landmass, there is a winter monsoon, where the moisture filled air moves away from the landmass and back over the Indian Ocean. This is less visible probably because most of the rainfall occurs over the ocean.

When a country receives 96-104% of its 50 year average rainfall (89 centimeters in India) in the four month span, it is deemed 'normal'. The southwest monsoon in India is expected to be 'normal' this year, according to India's Meteorological Department.

If rainfall is below 90%, it is labelled a 'bad' monsoon -- for example, a 2010 drought during the Thailand growing season caused $450 million in crop damages.

For contrast, next year, Thailand experienced the worst flooding in over 50 years from an 'excess' monsoon (if rainfall exceeds 110% of the average).

Floods like the 2011 Thailand can cause irreparable economic damage to nearby regions.

The massive flooding in Thailand caused $40 billion in damages, and key industrial sites north of Bangkok were forced to shut down. As a result, growth forecasts for the Thai economy were revised from 4 per cent to 3.1, according to the Guardian.

Source: Research Program on Climate Change, Agriculture and Food Security.

And that would be a global problem.

Research says that the changes in rainfall could lead to the area's food production dropping 50% in the next 30 years, which could seriously affect the international food supply.

Now scientists are searching for ways to control mother nature's fury in the future.

Solutions for the problem of too much or too little rain are being proposed, including a plan out of Thailand, 'Managed Aquifer Recharge' (MAR), proposes capturing and storing floodwaters for when inevitable dry spells occur, according to Thailand's The Nation.

Meanwhile in China...

China's Enormous Three Gorges Dam Could End Up Being A Huge Mistake >

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.