AFTER two successive dry years, 330m people in India, around a quarter of the population, are facing acute water shortages. A scorching summer is at its peak: destitute farmers are committing suicide and tanks are running dry. Officials in Madhya Pradesh, in central India, have deployed armed guards to protect a fast-depleting reservoir. Last month, in a last-ditch effort to save lives, trains carried millions of litres of water to Latur, a parched district 400km east of Mumbai. In mid-April, an “above-normal” rain forecast by the India Meteorological Department was a godsend for a country reeling from its worst water crisis in four decades. Earlier this month, it predicted the onset of the monsoons on June 7th.
A good drenching will lift the spirits of both farmers and businesses. Over 600m people in India depend on agriculture for their living and nearly two-thirds of land under cultivation has no irrigation and so relies on rain. The period between June to September brings three-quarters of total rainfall but is known to be erratic four out of ten years. After last month’s cheery forecast, India's stock market rallied to its highest peak in four months. Arun Jaitley, India’s finance minister, predicts 8.5% growth this year. Car sales, a proxy for consumer spending, are already up. The demand for gold could rise by as much as 10%, says the World Gold Council, a group of leading gold-mining companies. In April, the Reserve Bank of India, the country’s central bank, cut interest rates for the first time in six months; a good monsoon could raise the prospect of another cut. But the euphoria surrounding the prospect of a decent shower only points towards a deeper problem.