The path between west Indian Ocean observations, monsoon dynamics and prediction of interannual climate variations in surrounding countries is explored. Recent progress in understanding ocean dynamics associated with SST variations and ENSO-related climate coupling is reviewed. A zonal dipole in the thermocline develops across the tropical Indian Ocean. It modulates the tropospheric moisture flux across the basin, hence rainfall in surrounding continents. The western centre of action extends along a thermocline ridge near the Seychelles Islands. A specific design plan for a TAO array is proposed, linking global and basin-wide efforts in an efficient manner.