India braces for 2018 monsoon
The major incoming risk in the three-month outlook are the monsoon rains, which will bring torrential rains and fatalities to southern India. They are forecast to hit the Kerala coast on 29 May. Before that point, extremely high temperatures will cause water-shortages, discomfort and will elevate the risk of civil unrest across a broad range of agricultural and political axes.
PRE-MONSOON RISKSBusinesses operating in southern India should be aware that mounting water-stress has aggravated public sentiment in nearby rural areas, many of which suffer from drought, even though India's farms are not as dependent on the monsoon rains as they once were. The government has worked for decades to reduce India's dependence on rain-fed agriculture, and U.S. Department of Agriculture figures show that India's area of irrigated land has increased by well over 30% since 1980, mainly through the use of groundwater pumps. However, over that same period India's population has doubled. It is this trend, rather than variations in the monsoon rains, that is placing pressure on water supplies. This pressure is translating into social unrest that in some cases has been targeted at foreign businesses perceived to be water-intensive. Likewise, companies that are perceived to be heavy water users must anticipate the possibility of court rulings that impair their operations.
Protest risks rise to certain types of businesses in the hot seasonThe highest-profile dispute is between the southern states of Tamil Nadu (including the city of Chennai) and Karnataka (Bengaluru) over water allocations from shared rivers. In April 2018 protests outside their stadium forced the Chennai Super Kings cricket team to re-locate from its Chepauk ground in central Chennai. However, the franchise's new home in Pune, Maharashtra province, also faces water risks. Also in April, a judge ruled that the Pune cricket ground could not use water from the Pavana river to tend its pitch. The water dispute has already caused wide-scale business disruption in Tamil Nadu during the 2018 pre-monsoon season. On 5 April opposition parties led by the DMK staged a bandh in Chennai and the surrounding province, a form of strike that shutters all commercial activity. Police made tens of thousands of arrest, many of them around Chennai's central Marina Beach area. The DMK hailed the event as signifying the public's opposition to the way the central government is managing the waters dispute. Also Read: Malaysia regroups Protest risks rise to certain types of businesses in the hot season. Last year, in March 2017, retailers in Tamil Nadu announced a boycott of Coca-Cola Inc. and PepsiCo's bottled beverages. They accused the U.S.-based companies of straining local water resources. Soft-drinks bottling, paper manufacturing, steel-making and even thermal power plants are at risk of being targeted by political activists. For other sectors, the biggest risk posed by the water unrest in southern India is to the safety and mobility of staff as they transit through areas afflicted by mass protests or unrest, which carry an additional risk of violence between demonstrators and police. Security managers should retain the services of consultancies with a strong record of anticipating such protests, and work with staff to notify them if wide-scale unrest were to manifest itself. The pre-monsoon months are the hottest of the year in South Asia. In April 2018 a city in central Pakistan recorded temperatures of above 50C degrees (122F). In early May heat-stroke claimed the life of a farmer in central India. In the Pakistani city of Karachi, NGOs were reporting 65 deaths from heat stroke by late May. Managers should ensure that personnel for whom they are responsible are not committed to lengthy periods spent outdoors in such heat, and that vehicles undertaking long journeys are equipped with plentiful fresh water.