Showing some signs of recovery in the economy, the industrial production grew at a 5-month high of 3.8 per cent in November due to improvement in manufacturing and mining sectors and better off-take of capital goods. The factory output, as measured by the Index of Industrial Production (IIP), had declined by 1.3 per cent in the same month of 2013. The revised figure for October last year remained unchanged, a contraction of 4.2 per cent, according to the data released by Central Statistics on Monday.
For the April-November period of the 2014-15 fiscal, IIP is up 2.2 per cent, as against 0.1 per cent in same period of last fiscal. Manufacturing output, which constitutes over 75 per cent to the index, grew by 3 per cent in November, compared to a dip of 2.6 per cent in the same month a year ago. For April to November, the sector saw an output growth of 1.1 per cent, compared to a contraction 0.4 per cent in the year-ago period.
Output of the mining sector grew by 3.4 per cent in November, compared to a growth of 1.6 per cent. During the April-November period, the production has grown by 2.5 per cent, compared to a contraction of 2.1 per cent during the first eight months of last fiscal. The production of capital goods, a barometer of demand, grew by 6.5 per cent in November, as against a growth of 0.1 per cent in same month of last year.
During the April-November period, capital goods output grew by 4.9 per cent as against a dip in production by 0.1 per cent. Overall, 16 of the 22 industry groups in manufacturing showed positive growth in November According to the IIP data, power generation grew by 10per cent in November compared to a growth of 6.3 per cent in the same month last year.
For the April-November period, electricity production is up 10.7 per cent, compared to a growth of 5.4 per cent in the same period of last fiscal. The consumer goods output declined by 2.2 per cent in November as against a dip in output at 8.9 per cent logged a year ago. For April-November, the segment showed a contraction of 5.7 per cent, compared to a decline of 2.6 per cent in the same period of 2013-14. The consumer durables production too declined by 14.5 per cent in November, as against a dip of 21.7 per cent a year ago.
Expresssing optmism on the growth turnaround, India Inc said the turnaround needs to be made consistent for a longer period. “While it is heartening to see the growth in manufacturing in November, however it does come over the negative base,” FICCI President Jyotsna Suri said. “There is a sense of optimism in the industry with the steps taken by the Government in the last few months and we are hoping that Government will continue to push reforms so as to revive manufacturing sector’s growth on a sustainable basis” Suri added.
ASSOCHAM noted a clear turnaround in India’s industrial production eventually taking place in November and congratulated the political leadership for providing enabling environment required for this turnaround. “The 3% growth registered by the manufacturing segment certainly stands out. Consumer durables segment remains to be the area of concern. Sustaining the sales of this segment in the absence of excise duty cuts is an issue,” said, DS Rawat, Secretary General, ASSOCHAM.